Not sure if you listened to the call; this matter came up.
In a question relating to the mechanics of the equity raising, and specifically why the SPP is what it is, they referred to a small SPP take-up when they previously raised capital (which was in 2015).
The big difference is that there are now ten times more shareholders who might be putting up their hands for an SPP offer amount that is not any different in quantum.
Great, well-managed company, but in this particular respect, they appear to have been poorly advised.
I suspect a number of shareholders will not be feeling very gruntled by this.
The problem is, what is the alternative structure to raise the required capital?
Just a placement alone? Probably more efficient, but that reflects indifference and contempt for small shareholders.
An entitlement offer? Equitable, but time-consuming and more costly. And besides, it fails to achieve the broadening of the institutional shareholder base objective.
The entire raising is actually quite modest ($55m in the context of a ~$1.2bn market value company), so there's not much to go round, especially considering the desire to include new institutions, to the extent that such demand exists (which, given the circumstances and the pre-eminent performance of the business, one assumes is the case).
It's a bit of a curly one.
Initially, I was a bit miffed, but now I'm more "Meh"
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