Who in the right mind would buy newly issued OVT shares for 7.0¢, when existing shares were trading at 6.8¢ before the trading halt?
Furthermore, issuing new shares will dilute shareholders existing holdings so I would expect further declines in the stock price.
The last point is that when the CEO states, "We are moving towards the end of our financial year and market conditions are delivering revenues that are lower than anticipated. In light of both our site consolidation project and current financial performance, the Board has decided to raise some equity (cash) in the form of a rights issue.", shareholders need to ask the question, why is the company spending +$1million implementing an Oracle CRM when the company is only valued at $34.6 million and at a time when they're cash strapped?
OVT Price at posting:
6.8¢ Sentiment: None Disclosure: Not Held
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