We've Got THE Cells!, page-104

"Yes I'd like a fully renounceable issue of course! But you know very well that the placings are normally smallish..."

The placements are "smallish?"
Post-Cephalon, MSB has raised close to $500m. That's hardly what I'd describe as smallish.

As a consequence, there are today 55% more shares on Issue than there were in 2011.
That's an issuance of new shares at the rate of around 8%pa.

In other words, the value of the company has to go up in value by 8% pa, for you - as a minority shareholder - to just remain where you are.

Many investors would be quite happy with an 8%pa compound annual rate of return; yet you are content to simply let it pass you by, and for some total strangers to be the beneficiary of that value uplift that you have foregone.


As for " the placings are .... done for reasons of speed simply because the whole equity sector is generally bound up in the mind numbing legacy paraphernalia of brokers, underwriters, etc etc all with their grubby hands out. That will all disappear of course in time as the change merchants shred them with new technologies."

Those new technologies - that are capable of by-passing the "grubby hands" of the stockbrokers, underwriters, etc. - already exist today.

Share registry managers such as Computershare possess them.

To raise $100m for MSB, Computershare will charge less to do so via a fully-renounceable entitlement offer to all shareholders, than Bell Potter will to do a placement to its "special" clients (many of which would be the very short-sellers, that many here so love to hate, and who are short the stock and who put their hands up for, and get allocated, placement stock as a means to cover their short positions without having to buy the stock on market [*]).

[*] If MSB's management really wanted to deliver a blow to short-sellers he would raise capital via entitlement offers; then you'd see shorter's - who would have been waiting for placement stock to clear their shorts - scrambling to buy stock on-market in order to cover their positions.

Every time the company raises capital through selective placements, it plays directly into the hands of those that have short-sold the stock. I can't believe the MSB board can't see that.