Ann: ECS to execute expansion plans following $4m Placement., page-51

I’ve done work in the SME lending space, I can guarantee you that with the cash position and financials that ECS is unlikely to have approached any other lender. To simply quote that NAB wouldn’t extend the facility doesn’t rule out not approaching other lenders. The effort required to run a capital raise and draft the prospectus alongside the investor relations side of it is far more effort than a simple SME loan. Big banks are not the place for this type of loan.

Nan and management would be well aware that they are being criticised for this, and rightly so. She has decided to take on the political approach and given a response with a lack of any meaningful insight. She is within her grounds to state that they couldn’t increase the NAB facility. But NAB and the existing facility + a Bell Potter capital raise at all time lows were not the only two options available. If management went down this path without seeking alternate options (which they have refused to discuss) then to me and the rest of us shareholders, they simply didn’t think to increase funding any other way. Which then to me, indicates that the cap raise was unnecessary and there’s some incentive to have conducted the raise. Because in any world, liquidating your assets before using an option that doesn’t liquidate is always the first priority, especially when you’ve already got over a billion shares…