I have a theory & for what's it's worth, here it is:
Bayrock is an unlisted public company
So maybe 50 shareholders
They need cash
They know who of the 50 existing s/holders can & will take up their rights - I mean, how many tightly held unlisted companies do under written rights issues without knowing from the get go who will & wont subscribe???
So my theory is that they know already how much the shortfall will be
QXR doesn't have the spare cash (we need it for drilling) to u/write $1.8m (60m shares at $0.03) but we do have loans owing of $585k of which $255k has been taken up as shares (not part of the rights issue) for approx 16% of Bayrock
That leaves $330k of the $1.8m issue which QXR could also take up as shares (they say we are to be paid out in cash from the issue, but.....it's at QXR's discretion as U/W as to how any shortfall is allocated)
My theory is QXR will end up converting the entire outstanding $330k loan for shares to give us (perhaps 40%) of Bayrock without having to make a takeover
QXR may well end up with more if there is a shortfall
Which, just maybe, QXR could offer to its shareholders!!!!
Just a Thursday morning waffle!!
QXR Price at posting:
3.6¢ Sentiment: Buy Disclosure: Held
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