IHS (ASX) Good oil conference

Originally posted by morsetrader ↑

I’ve been having a look over this one and why it hasn't responded to seemingly positive news and I think it comes down to one question, that is can anyone tell me who is selling their options as part of this transaction?

The options that are being exercised are dilutionary to shareholders regardless. They’ve already been issued and are currently in the money. The big question is why don’t the existing option holders exercise them themselves if they are believers in the company and the project? From what I can gather all of the options on issue have been issued with zero consideration (but if I’m wrong please correct me) so therefore this raises a couple of major questions : Firstly what is the pricing mechanism being used to determine what is being paid for the options? I can only assume its going to be at intrinsic value. That is, if the stock is trading at 40 cents at the time of the second stage of the investment, do the option holders get paid 20 cents per option? If this is the case, how does this benefit the company and its existing shareholders? Given the large quantity of options (47.75 million) I can only assume that this number can only be held by a privileged few ie.vendors/directors/promoters. So does this mean that they get to take a huge chunk of money off the table for something they were issued for free? As I said before why wouldn’t the current option holders just convert themselves and put that money into the company and then all the proposed extra money that is being paid to the option holders goes into the company itself at the same price and as part of tranche 2 which is at approximately 40 cents per share?

Secondly if the option holders are going to benefit this much out of selling their “free” options then to me this potentially raises the issue of conflict of interest with the existing shareholders. What I mean is that the sale of options and the second placement tranche are stage 2 of the transaction. This is triggered by “the execution of a Gas Sales Term Sheet”. There are no minimum terms stated at all in the announcement so does this mean that the company can sign any old sales term sheet no matter what the terms and that triggers tranche 2 and the insiders get to sell their free options?

Sorry for all the questions but this whole announcement is light on in detail and is somewhat ambiguous. As I said It appears to me that there are people wanting to take money off the table here and are happy to hand over control and that perhaps WhiteNoise they realise that what you’re saying has some merit with regards to the asset and that it’s potential is limited.

DYOR

Expand

ASX Market Open: Aussie market to leap on best 'Trump trade' bump since election day | November 22, 2024

MIN

MinRes's Ellison knows he screwed up – for that reason, hunt for new Chair to be sped up

CAF

IP anomaly thrills Cannidah with project extension hopes in QLD

CMB

Asian Battery Metals uncover second massive sulphide discovery at Mongolia's Oval play

ALY

Alcidion inks deal with Vic health provider Peninsula for use of Miya Precision tech

C1X

iTech inks deal with Chilean lithium giant to progress Reynolds Range

WC8

Pan Asia rebranding to 'clear confusion' after bagging $35M for Chile projects

PCL

HotCopper users react as Pancontinental Energy's trading halt lift reveals little

BTH

Bigtincan's Board backs Investcorp offer: Why a NASDAQ listing could be game-changing

GRL

Good oil conference, page-3

ASX Market Open: Aussie market to leap on best 'Trump trade' bump since election day | November 22, 2024

MinRes's Ellison knows he screwed up – for that reason, hunt for new Chair to be sped up

IP anomaly thrills Cannidah with project extension hopes in QLD

Asian Battery Metals uncover second massive sulphide discovery at Mongolia's Oval play

Alcidion inks deal with Vic health provider Peninsula for use of Miya Precision tech

iTech inks deal with Chilean lithium giant to progress Reynolds Range

Pan Asia rebranding to 'clear confusion' after bagging $35M for Chile projects

HotCopper users react as Pancontinental Energy's trading halt lift reveals little

Bigtincan's Board backs Investcorp offer: Why a NASDAQ listing could be game-changing

To make modern missiles, you need 3D Printing. And in that gold rush, Amaero is selling shovels

Featured News

Good oil conference, page-3

Top Stories

ASX Market Open: Aussie market to leap on best 'Trump trade' bump since election day | November 22, 2024

MinRes's Ellison knows he screwed up – for that reason, hunt for new Chair to be sped up

IP anomaly thrills Cannidah with project extension hopes in QLD

Asian Battery Metals uncover second massive sulphide discovery at Mongolia's Oval play

Alcidion inks deal with Vic health provider Peninsula for use of Miya Precision tech

iTech inks deal with Chilean lithium giant to progress Reynolds Range

Pan Asia rebranding to 'clear confusion' after bagging $35M for Chile projects

HotCopper users react as Pancontinental Energy's trading halt lift reveals little

Bigtincan's Board backs Investcorp offer: Why a NASDAQ listing could be game-changing

To make modern missiles, you need 3D Printing. And in that gold rush, Amaero is selling shovels

Featured News