FAR (ASX) Cash is King

Originally posted by OFL8777 ↑

Farjoy are on Bell Potter list, as they were part of the placement at 4c earlier this year. I expect them to pick up additional shares at 11c to at least maintain their 10%.

It sound like 330m have already been placed, the balance plus any part of the 330m not taken up will be offered to the sophisticated investor(SI). I believe there are two ways this happens firstly each broker is allocated shares to distribute to their SI, or through the broker each SI bids for the number of shares they want. If they bid, normally you would ask for 10 time what you really want so you end up with a reasonable allocation. Allocations like FAR today are always oversubscribed. There is a risk that you may get 100% allocation and have to pay up. Brokers also expect the less important SI to take up the more risky placements.

Brokers rank their SI on their available funds, previous support and how much money they make out of SI via trading and brokerage fees. The high ranking SI get looked after, and I expect Farjoy to be at the top of Bell Potters List.

As a SI you get a call and a 2 minute run down of the company on which you are expect to commit to $20k to $100K worth of shares. If you hesitate or don't take up the offer the next time there is a decent placement you don't get the call. The only additional info you get is an email of the latest company research note done in house.

I do not expect the share price to drop much next week because as I stated in my CR post Wednesday some shareholder have been selling expecting to pickup the shares at 11c through the allocation. FAR would want to put out as many positive ann to reward the SI and Bell Potter for quickly raising the cash. Raising 46m in less than a week is impressive, if you wish to see a poor CR look at WHN.

The SP will come under some pressure once these additional shares are allocated on 27/10/14. I don't believe the 330m placement will be traded or Farjoy's additional 42.5m, leaving only 110m (less any amounts that have been sold in anticipation of the CR) that may be sold for a small profit after the 27/10/14.

We have not seen any change in Fonty's holding last week and assume that one of the factors for the SP not increase is due to less demand as Fonty got to his target of 10%

There is a real risk that good news will come out in the next week resulting in SP support above 12.5c, So if the 110m shares are sold off it will look like capping at 12.5c for a week (also believe that we saw capping last week and this may explain it). The timing of release of news is managed by good operators like FAR, look at the Investor preso for additional info, the Bell Potter valuation, Faye commenting on Senegal producing oil, all in the week before CR so expect more good new next week.

I think back to Sundird when the Energy Minster stated that the well was non commercial a month before BG released their findings, The minster was right

My Friend stated that there was a CR at 11c through Bell Potter Wednesday. He was right

I hope to say the same thing about Mr Faye's statements in a few weeks!

This is not a done deal yet but I do not believe we have had any negative news so far as trolls do not count.

If you think you will pickup shares on market at 10c and 11c good luck, is there anyone on HC willing to sell their shares for less than 12.5c? I will not, I will hold and hope to accumulate below 12.5.

All IMHO, GLTA and DYOR

Some the posts are so funny, I'm normally ROFL, and aslo pretend to understand Ya's post
Thank you and please keep them comming

Expand

OFL

Good comments and a likely set of outcomes. I can't see FAR going below about 12 after the placement is announced. I will be in the queue with you at less than 12.5 that's for sure! As you say many of the shares will not be sold (insto allocations?) and many will have taken profit last week "knowing" or suspecting a CR was coming ... and they will want to buy back in too before the price gets too far above the 11 cent placement price (or above the price they sold at when taking profit .. so mostly 12.5-13.5).

H

No.	Vol.	Price($)
2	90218	49.5¢

No.

Vol.

Price($)

90218

49.5¢

Price($)	Vol.	No.
50.0¢	3388	1

Price($)

Vol.

No.

50.0¢

3388

No.	Vol.	Price($)
2	90218	0.495
1	99999	0.490
3	114597	0.485
4	260000	0.480
1	100000	0.475

No.

Vol.

Price($)

90218

0.495

99999

0.490

114597

0.485

260000

0.480

100000

0.475

Price($)	Vol.	No.
0.500	3388	1
0.505	88712	1
0.510	125200	4
0.515	120000	2
0.520	149917	3

Price($)

Vol.

No.

0.500

3388

0.505

88712

0.510

125200

0.515

120000

0.520

149917

(20min delay)
Last 50.0¢		Change 0.005(1.01%)		Mkt cap ! $46.20M

Open	High	Low	Value	Volume
50.0¢	50.5¢	50.0¢	$11.78K	23.34K

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