re: Ann: Australian Graphite Producer Places ... Aushed's,I...

re: Ann: Australian Graphite Producer Places ... Aushed's,

I don't doubt your statement but can you give a reference to where this constraint is in the Corporations Act or ASX rules. Surely there must be a time constraint on when a company can cancel shortfall shares. I have seen situations where to company simply holds shares themselves but maybe they cannot hold shares and then do a placement at a different price - I don't know? Surely if the company have shortfall shares these can at least be re-offered to existing shareholders as a revised Right Issue using the old prospectus rather than "placed" with people who want cheap shares (and options) without the IPO risks.

I have not (and do not) doubt the VXL's board's wish to operate in the interest of shareholders (including themselves), however I have seen many boards fsvouring institutions, mates, sophisticated investors (these people usually include the directors) to the disadvantage of retail investors (called "Mums and Dads"). There are many examples (i.e see the recent Virgin CR). Anything other that revokable rights issue to raise capital is usually to the disadvantage of "Mums and Dads" - the problem is that the rules make them a pain in the butt in terms of bureaucracy and timescales, which simply makes the process untenable.