Ann: $30m Equity Raising to Advance Sheffield Growth Strategy, page-28

I may be shooting myself in the foot with this final post, nonetheless here goes.

in my view the results of the rights issue which are due tomorrow will tell us what the real money thinks of SFX/TB as an investment.

I suspect that some mums and dads investors will have passed on their entitlements simply based on where the stock traded over the last two weeks (the sp in my view stayed around 50c either because it was intentionally held there and/or because of an arbitrage effect and not because that's all it's really worth).

The real telling sign will be if Yansteel and Blackrock take up their rights, and equally important, if any shortfall is taken up by institutional investors (probably those that participated in the placement). If that happens we know that the valuations from a professional/institutional stand point look highly attractive.

Note that the shortfall was not underwritten so any take up from institutions is a sign of real demand and not obligation in exchange for an underwriting fee.

This to me is the real practical evidence of value, "proof in the pudding".

I suspect that this placement in part was an entry point for institutions that couldn't otherwise get set into the stock without pushing the price up.

if it is this, it's good strategic management by Mr Griffin who had to address some share market dynamics which have prevented SFX shares from representing real underlying value.

The placement has been priced and timed such that it's optimal for new sophisticated investors to enter (construction on time and budget and commissioning looks fairly standard in the absence of an LTR and with several bulk sample studies under the belt. Also market cap relative to earnings very low).

it could also be said that the raise was prudent incase we are unpleasantly surprised by something, and to allow for diversification and value accretive activity.

Therefore, as an existing shareholder I wouldn't look at a slight rise in share price from 50c as an opportunity to exit, especially if you've been a long term holder. I can imagine that now that the investor base is changing we might see the share price re-rate to more comparative levels (to other listed stocks).

Let's see what happens to the shortfall.