I asked a lot of questions about this CR. I believe I said something like "if these guys want to buy, why not go tell them to piss off and go buy on market?" Reason I was told was that the two acquisitions, although done as stock deals, will still have rather significant costs involved that will drain some cash. And cash is really important for a company growing so quickly. So the opportunity came to do a small CR to cover the costs, and so the acquisitions will not shorten the runway the company has. It will then truly be an all stock deal, and not cost the company any cash. Why do it now? Well you never know what may happen with the market (Brexit for example). It's better to take the cash now and get it in the bank than to wait until you really need it and find out the investors are not there. Why offer it at 10 cents and not 11 or 12? Well it needed to be at a discount otherwise the investors would have a better deal just buying it on market, and the company would not get the extra cash. He said he was pleased with the raise, the announcements caught the attention of new major investors who are now on board. The entire amount was raised very quickly.
We also discussed the company's overall strategy in regards to releasing news and revenue numbers. Dave said that his main job is to run the company, not to pump the stock price. He has a policy of only releasing information about signed deals. He referenced other companies that listed on the ASX and released revenue projections and potential deals, only to then have to back track on something that didn't come to pass and so the stock price crashes. What he is focusing on is building the company, and eventually the stock price will follow. We will get our numbers from the quarterly reports.
Overall he said he is pleased with the progress and pace of the company. They are in good shape, and the SP will catch up as investors see the results of the company's efforts in the reports.
Hope that helps
BUD Price at posting:
11.0¢ Sentiment: Buy Disclosure: Held
