Fundamentals Are Strong, page-29

What I'm trying to say is that a good quality company makes money for its shareholders. And they, in almost all cases, does it with little or no new capital raising.

Good businesses fund their growth and expansions through the earnings and profit they produce from their existing business operations.

If they need more cash to invest or acquire, they often have friendly bankers willing to lend most of the proceeds for peanuts. And if they do need to raise equity, they do so very, very, infrequently...

Infrequent because good business opportunities at reasonable prices are rare. Also little new equity is need because a quality business would be making so much cash that there's no need to raise anymore from shareholders.

Mayne has not met any of those basic conditions of a quality business. And for a drug company selling generic, cheap drugs into established market... to not be able to make good money like others have is a sign of a low quality business.

From memory, in its presentation on the Teva/Allergran acquisition... it [threatened? ] to buy another company at pretty much the same time it's making the biggest deal in its corporate history.

Slow man guys. Shareholders has given you a total of some $1B; you've also borrowed a few more hundreds of millions on that equity... let's put some heads down and try to make money for shareholders out of all that investment before you have more bright ideas about more acquisitions.

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That's not to say its share price won't go up. In fact, the Board just gave some 42 executives about 20million new shares "at" $1.15 or so.

So you can bet that management will be working over time to try and lift that share price. Just that history suggests they haven't been able to do that with what they've got... so more equity raising, more debt will be on the cards.

Just look at the chart on WalMart. Its 2014 dividend alone was more than all the equity its shareholders has ever contributed to the company. And we can't argue that WalMart hasn't been growing.