You are right. The SPP was announced on 9 July with Market Cap of $41M based on SP of 21c. That day the market opened at 22c and closed at 19c. Much as one would expect following such an announcement
With MD JW leaving on 9th August SP dropped from 16.5c to 13c and at close of SPP on 13 Aug the SP dropped as low as 10.5c, the same as today. With SP below the SPP, few would take up the offer. So management decide to pay liabilities from cashflow, rather than attempt a further, very dilutive placement. A good decision in my view.
The options issue is water under the bridge. Shareholders did not vote against them at the AGM, so they are issued. At 20c with current SP at 10.5c, then to be of any value to the directors, the shareholders close to double their money. That is not a bad outcome for shareholders and directors alike. That the SP could be nearer 40c than 10c is a nice thought.. however it isnt, but it is now in all's interest for the SP to recover.
Shareholder value will improve if two things happen:
1. operations are profitable 2. management start keeping us uptodate on progress
Hopefully this will start to happen soon
AAM Price at posting:
10.5¢ Sentiment: ST Buy Disclosure: Held
