Occasionally you make a reasonable point, but not this time.
A billion shares is not the problem, fractions of cents are the problem.
Of course, you won't be happy with the next likely step either. Once the capital structure is amenable to funds willing to invest large amounts of money, chances are there may be a material placement somewhere down the track.
This is how these corporate deals work. Cardiex probably realise that they aren't going to become a billion dollar company while the only investors are a bunch of retail speculators. We can't even seem to keep the share price north of 7c.
I would say the plan will be to try and build the market cap now to up around $100-200m, as hinted by current broker targets and on the back of the next few products, and then invite one of the funds to back them with enough money to expand their range or target more markets.
We won't know for some time, but I expect it would have been proposed as a strategy for breaking free from the shackles of penny dreadfulness.
It isn't a fail-safe strategy, it requires the backing of solid funds, but I doubt they are doing this of their own initiative. The down side is it takes some of the potential long term gains off the table, the upside is it ensures success.
Add to My Watchlist
What is My Watchlist?
