Originally posted by aniesbaswedan
Last CR was done at around 25 percent discount from memory so it is only logical that the upcoming one is going to be done at around the same level if not lower. I would say that the CR would be done at 0.04 cents price. If they need 20 millions dollars then that is 500 million shares dilution at .04 cents but it needs reminding that even SAS themselves think that current SP is prohibitive to capital raise. I suspect that even SAS is cognizant to the idea that the company would not survive another CR. So the only remaining option is for someone to fund SAS in return for nothing, which is very unlikely. I have warned relatively recently that any announcement, jump in SP, etc from that point on was going to be nothing more than exit strategy, pump and dump. From looking at how things are at present then it seems I was right. If it feels that someone wants to keep the price at 0.059 cents then I think that is quite true. Afterall one needs to keep the SP at a certain level in order to maintain just enough sentiment that there would still be buyers. At least until everyone who wants to leave has left.
The scenario you are suggesting is as if management and current top SH no longer believe in the Company and are planning/executing exit strategies. For the argument's sake, assuming your proposition is true, would it more beneficial for them just to remain idle (no CRD review, abandon the building of the 20 or so nano-sat and its subsequent launch) to save cash and extend the time period that they can execute their exit strategies. Seems to me that what's is happening is actually the opposite.
The only reason why the SP has been stagnant and steady decline is because of the uncertainties of how the complete launch of the constellation will be funded. While I agree that the current cash balance is not enough to fund the first batch of nano-sat while keeping a decent cash for working capital, hence, CR is needed, this company is far from over. I reckon a CR at 5c should be done soon both to current SH and sophisticated investors, if other funding is not available (ie debt instrument issuance).
