See todays AFR - basically saying company is seriously close to breaching its debt covenants, and the board have a seriously discounted capital raising ready to go (c $1-1.20 on hold, trying all other options first) & alternative is to re-court their recent private equity courters (but this will be very much on their terms this time - unlikely to be anything like previous offer - they will know they have company on their knees & demand a suitably demeaning hummer...)
Suspect the above was what drove the sudden 30c collapse in price a few weeks ago, for those "in the know" in our "free and efficient markets" . Us retail punters find out 3 weeks later in the AFR!
Anyway, from my experience the shorters are experts at flushing out capital raisings, fingers crossed I'm wrong, but from past experience boards that sit on needed capital raisings to avoid negative shareholder reaction, usually end up with it leaking via their bankers/advisers & end up having to pull the trigger later at a much worse (lower) share price with significant discount to get the raising away.
Suspect Bradken is now in the same boat - when will these boards learn???! They should have pulled the trigger at $2.30 with a rights issue at $1.60, now would have to be a $1.80 for $1.10 issue - so totally avoidable if didn't deny reality!!
Hope I'm wrong,, but think we'll see capital raising gun belatedly fired in next month or so.... either way I got out today - not happy with the "free and fair market" we enjoy when I learn well known facts through the AFR weeks after insiders in the know!!!
BKN Price at posting:
$1.83 Sentiment: Sell Disclosure: Not Held
