re: Ann: Toro Energy Announces Share Purchase... The problem is,...

re: Ann: Toro Energy Announces Share Purchase... The problem is, however, that as soon soon as a company announces a capital raising, the day traders [and smart money] are all over these shares like fleas on a wild dog.

Before the rubber hits the road, the discount offered to "loyal" shareholders has long since disappeared and there is no loyalty bonus.

If boards of directors do not understand this issue by now, then shame on them. Problem is, what alternatives do they have?? Banks ain't lending.

Springtree and other venture capitalists prey like vultures in the current environment... so the lesser of all evils remains the capital raising - but this means the investor has to have a long term view or learn how to trade short term. [I believe]. There is no discount to the loyal long-term holder.

But companies [and directors] need also be cogniscent of this dilemma, for they can no longer rely on existing shareholder loyalty given there is no benefit to them [seemingly] in such capital raising arrangements.

Also, many small caps are currently guilty of seeking inadequate funding which leads them to return to the market again and again [and again, in some cases], when the wise move would be to seek sufficient funding for enough years to see the company through to commercialisation of whatever they are selling and cash flow positive status.

In the current credit constrained/risk averse environment, [and this may last several years], repeated capital raisings will get punished share price wise, I do believe.

Questions for Toro, however,

... what is the status of our negotiations with the "Asian-based investor groups"? Is this still in play and just taking longer than envisaged [as stated in the ASX announcement back in December], or is it game over, and hence the need for alternative funding? [extract below]

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"Toro has been engaged with a number of Asian based investor groups interested in entering into strategic partnership with Toro through a cornerstone equity investment.

Negotiations regarding the equity investment at this stage are incomplete and inconclusive and may, if successful, take further time to complete. These negotiations will continue and the market will be updated again in due course.

With a current cash balance of approximately $15 million, and the recently announced addition of $3.75 million consideration for the retirement of the Mt Woods uranium rights in South Australia, Toro is fully funded for its near term activities at the Wiluna and Theseus projects in Western Australia and looks forward to further progressing these in 2012 towards their full potential."

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... how far will an additional $23million take us? [being 30% of current ord. shares @ $0.08 per share]? What is the funding plan to get us to commercialisation?

Anyone know the answers to these questions?

Toro management not forthcoming in their responses currently.