Ann: Entitlement Offer to raise $5.5 million, page-33

The way I look at it is this:

DXB will succeed or fail. If it fails, we will lose our money. If it succeeds we should make a handsome profit. While we all feel better when the share price is doing well, the current share price has nothing to do with the future share price if a the Phase 2/3 trials are a success and a deal is done to sell or license DMX-200 to big pharma.

The current market cap is around $15M. Say a deal is done that allows the market to work out that the company is worth $150M, or 10 times current market value. If the current management wasn't as incompetent at raising the share price as some are portraying, and the company was able to raise capital at 24 cents a share, the company would be worth 30 million, and only a 1 for 4 rights issue would be required. In other words, with the same outlay, shareholders would be increasing their equity in the company by 25%, vs 50% as it is with the current offer.

So if you believe that the company can be successful (which will depend on the success of DMX-200), then the lower the offer price the more beneficial it is since for the same dollar investment you are getting a greater equity share.

So if you believe in the company's future success, the lower the offer price the better. It could be one of the bargains of the century. Unless you want to sell, the current share price is irrelevant to the future prospects of the company.