Sometimes companies raise funds by doing a placement to...

Sometimes companies raise funds by doing a placement to institutions and sophisticated investors (as CNB has just done), rather than by doing an entitlement offer or share purchase plan to existing holders. Sometimes they may do both at the same time.

IMO the placements work well. Whilst I understand that existing holders may miss out (unless they are sophisticated investors), the placements are quick, usually raise a decent amount and importantly bring in new (and often wealthy) new shareholders.

IMO this may be a lot better than mucking around with SPP's etc where it takes weeks to complete, retail holders may apply for as little as $1k of shares, cheques need to clear etc.

Another point worth mentioning is that the fact that CNB can raise $20 million at a reasonable discount to market price in this way is a strong vote of confidence from the instos/sophs. Small explorers with languishing prospects may struggle to raise in this way - the insto's and soph's aren't interested (unless the discount to market is massive), so these co's may tend to rely more on existing shareholders to raise extra funds.

GLTA & DYOR