how come pwt isn't 2c??

Maybe there is more than meets the eye but how come PWT is still at 6c when the new investors want to dilute 1 billion shares to over 3 billion shares with a rights issue at 1c??

Surely the shares are now trading at a huge premium?



POWERTEL LIMITED 2003-05-09 ASX-SIGNAL-G

HOMEX - Adelaide

+++++++++++++++++++++++++
A syndicate of Australian investors intends to acquire the entire stake currently owned by WilTel Communications, PowerTel's largest shareholder, and in addition will finance and underwrite A$16.3 million of new equity for PowerTel and restructure PowerTel's balance sheet.

PowerTel and WilTel have reached an in-principle agreement with The Roslyndale Syndicate in relation to the following:

* PowerTel will raise A$16.3 million by way of a renounceable rights issue based on the issue of 1.5 new shares for each currently held share at an issue price of 1 cent per new share. The issue will be fully underwritten by The Roslyndale Syndicate.

* WilTel will sell to the Roslyndale Syndicate:

- All its equity stake in PowerTel (including ordinary shares to be issued upon the conversion of the Converting Preference Shares and accrued dividend rights currently held by WilTel) totalling 520,117,263 shares. Following conversion, rights to the 10% cumulative preference shares dividend shall cease.

- All PowerTel debt and accrued interest held by WilTel. The debt of $21.3 million shall then be converted at 2.42 cents per share into 880,165,289 million ordinary shares. Accrued interest will be written
off.

The effect of the above transactions being executed will be that The Roslyndale Syndicate will hold a 49% stake in PowerTel prior to debt conversion and 62% post conversion assuming that all rights are taken
up by PowerTel shareholders.