Agreed Debt reduction is a priority in the current market. However I would have thought that with the sale of the property, there would really be no need to do any capital raising, given that they are going into a consolidation phase. I am somewhat puzzled as to what would motivate the need to raise capital whilst the market is a shot duck?
I didn't see a cut off date to be eligble to participate in the rights issue, that would have confused the market somewhat. Perhaps it is for existing shareholders, (as it should be I reckon).
The other thing that strikes me as odd is why they released this news all at once. The property sale on its own might have put a floor in the high teens, then the RI might have had more appeal.
So working on the theory that these guys are smarter than me, one would suspect there is some news in the pipeline to sweeten this deal.
Looking forward to reading what comes via mail.
Oscar
DES Price at posting:
0.0¢ Sentiment: Hold Disclosure: Held
