Karlene: Why does someone sell shares at $2.00 and then annnounce a buy back when the shares are selling for $3.25 odd.
hello Karlene.
we don't know the circumstances around the $2 placement to M&G. maybe one day, we'll get to read about it in a biography.
however, with Oceanwide now wanting to buy up to 30% of issued stock at or around $3.80, it makes complete sense to buy the shares on market now at the lower price. that should be pretty simple to understand.
why is it necessary to have a trading halt each and every time a new discovery is made.
when a piece of ground is found to contain valuable minerals, it adds value to the company. it is therefore a price sensitive announcement, and many of these require a TH. a TH helps guarantee fairness to the public in that people who come into contact with the contents of the announcement will not be able to trade it until everyone else is able to. this includes employees and relatives of the ASX.
Further more when funds are invested and showing an excellent return of approx a million a month why spend so much buying back when the funds could be needed in the near future.
as others have pointed out, the interest from the banked money will on its own enable the company to buy back many shares from the market. I believe it is also very important at this time, now that we are so close to the end game, that long suffering Mum and Dad retail investors are protected from the sharks whose self-serving poisonous activities are ignored and therefore condoned by the ASX even though they're illegal.
the buy back is therefore also an extra defence against would-be predators, by allowing long term loyal shareholders to hold on to their shares, and keeping those shares out of the hands of the predators or the predators' partners and friends.
We already know that the previous buy back was a disaster, so why repeat the performance.
was it a disaster? it depends on the purpose of the buy back. do you know the purpose of the previous buy back?
take care.
