I have no big issue with J.R. using the cap raise to reduce his holding in ASB, it's often difficult for founding shareholders to rebalance their portfolios once their baby has grown up and moved on to bigger and better things. He couldn't sell down many more to Tatterang without triggering a takeover offer.
It's also worth noting that in offering his $50m in shares at the cap raise price of $3.80, he has de-valued his current ASB holding of 32.8m shares by approx. $23m, so he will only(!) be grossing $27m at the end of the day. By my estimate he will remain a major (+5%) shareholder.
The CR discount of 15.6% over the previous closing price looks steep, but considering the 30 day WVAP discount is only 5.5% it looks reasonable IMO. There was obviously a tight rein kept on the C.R. news internally as the SP has increased considerably in the previous month against the backdrop of the Trump Correction, which is a big tick for management.
Hopefully the SP will recover enough to offer existing retail shareholders the opportunity for a tasty little arbitrage on the SPP...free money for zero risk!
DYOR & GLTAH!!!
ASB Price at posting:
$3.75 Sentiment: Hold Disclosure: Held
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