Following the CR announcement this morning including a SPP....
As holders of any quantityof VUL shares on the record date, we can purchase up to $30k worth of sharesbeing offered under the SPP at $13.50 per share. This is a 15% discount to yesterday’sclosing price. It is pretty “normal”to see the share price drift towards (and sometimes get to) the offer price……thisis no need to panic as it is generally only for the short term. The reason ithappens is that some shareholders decide to sell some of their current sharesto pay for the discounted shares on offer. In this instance, you could sell 322shares at say $15.50 to buy 370 shares at $13.50 under the SPP….effectively endingup with 48 additional shares for “free”. As a result, we are likely to see theshare price be put under some selling pressure when the trading halt is liftedwhilst some people raise the funds to participate by selling some VUL shares. Somewill prefer to raise funds without selling VUL shares and others still will doa combination of both. As I said, this is normal and, from what I’ve seen inthe past can be pretty short term as the share price typically rises again afterthe selling during the period of the SPP stops.
Whilst the above is a consideration, we also have some added buying pressure during this time as Institutions needto buy VUL for any ASX300 Indexed Funds they may have – following our inclusion into the ASX300 list as of 20/9. The Capital Raise and SPP may add some liquidityto the market due to some selling – but this may even be counteracted by theInstitutional buying during the same period. The share price might not dip downas much as a result. We will find out over the next few weeks.
The progress VUL hasbeen making has been great and, IMO, there is a lot of upside to come inthis share yet so I’m aiming for as many as I can keep a hold of. VUL have agreed “Terms Sheets” (i.e. the basis for an offtake agreement) with both LGand Renault recently. In the announcements at the time, there was a mention offormalising Offtake Agreements in November this year……and I would expect asignificant rise in the share price to eventuate following those announcements –as well as other announcements about their progress. The previous announcementsabout the LG and Renault agreements stated “Conditions precedent to start ofcommercial delivery include the execution of a definitive formal offtakeagreement on materially the same terms by end November 2021, successfulstart of commercial operation and full product qualification.” I’m notexpecting any dip in the share price to last long.
GLTAH
(20min delay)