Ann: Suspension from Official Quotation , page-51

I wouldn't see the fact that the raising might be at 4 cents as reason for a SP retrace. Any significant raisings are usually at a sizable discount to share price to attract interest. In this case a 4 cent raising is not a big discount when you look at 30 day VWAP. A raising at a premium to share price is pretty rare - yes I know FSE did this not so long ago - but that 18% premium was for a chicken feed raising of $2m.

For the company, the discounted price is usually compensated for not just by the quantum raised but also the advantage of having Instos and sophisticated investors whom, if it has been well targeted, are taking a long term view (= more price stability), rather than the instability that comes with a register full of short termers and day traders.

BAU is an example of a company which did a placement at 50c cents, which many worried would put a ceiling on the price, and two months later it broke a dollar this week!

In the end, it all depends on the growth story and the confidence people have that management can deliver on the strategy.

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