SPP and more, page-2

I just want to put this raise into perspective. Below is a table I have constructed:





How the table above is constructed, after going back to the 21/08/2019 announcement - Post #: 40070041:

1. Existing Shareholders - 592,153,136 New Shares at 1.15 cents raising $6,844,261 before costs, albeit I get a slightly different (A$6,809,761) answer in my table above . Last year's annual report - Post #: 35918690 - (page 56 ) states 6421 shareholders. For my modelling below, I'll just assume 6000 SH are eligible to participate. If all eligible share holders participate essentially translates to 98,692 shares (or roughly $1,135 per shareholder in cost). So certainly looks like see a scaling down in allocation for those ticking the $10,000 and $15,000 boxes of the application if all eligible shareholders take their entitlement, unless the below point 3 happens.

2. Top Up placement, if undertaken, for Sophisticated investors - ASX Listing Rules 7.1 (290,326,568 shares) and 7.1A (196,884,378 shares) on completion. Based on my maths they don't need to utilise all of the 7.1A allocation (refer Table). In terms of this point 2 above, they have stated in 21/08/2019 Ann that they intend only raising $4 million under Top Up, before costs. Noting it is to be done after 1.

3. I presume under Point 1, Patterson's is underwritten to A$3.5 million, or roughly 50% of point 1 above but by the looks of it I suspect they won't be needed to underwrite 1 above at all (given where the share price is now). Which leads me to point 2 above - I wonder whether Patterson might take some of that holding as a strategic investor and/or whether if Point 1 above is over subscribed whether some of Point 2 can find its way to current shareholders thus increasing potential allocation to existing shareholders who participate in the SPP at Point1 (assuming it is over-subscribed). I am not sure about the ASX rules here.

4, Having said the above, I am a little annoyed, actually very annoyed as this raising too me is the direct result of the missed timelines of management here (and morse code in previous Anns that if in hindsight I read properly using the negative would indicate they did not have enough money to DFS) . Depending on what transpires in effect I see the amount of new shares coming onstream over existing shares been about half of the existing shares which is dilution by however you measure it (unless AVL actually achieves timelines and gets things done because if so then SP will look after itself, albeit with the current vanadium price the Internal rate of Return in the forthcoming DFS may not be as great as some think it might be - Post #: 38738778. This raise IMO is not a glowing endorsement of management.

5. Whilst annoyed I will probably participate, i.e. have cleared funds to BPAY Wednesday, but still deciding and to be frank the last few announcements appear to have come at the right time for AVL to keep the SP above 1.15 cents and more than likely under 1 above Patterson's won't be needed to underwrite the offer IMO.

All IMO over a good cold VB