Can't say I know anything more than in the announcement - they are covering their DRP shortfall with a placement to sophisticated investors.
This raises some issues:
In going down this route, WAX almost forces investors to take part in the DRP as they will not be diluted to the max amount possible under every dividend. Normally, only some percentage of shareholders would take part, so the rest can wear it, but guaranteeing 100% conversion of dividends to shares is a whole new consideration
Secondly, one wonders why they do it. Normally, a DRP is used to strengthen a companies financial position to weather profit headwinds or build up a war chest. If the former, one would have to wonder why, after all WAX is just an investment vehicle. If the latter, it is a sneaky way to build up the size of the company to boast market size without actually having to work to do it.
In any case, one would hope that the funds add to the NTA of the company, so leaving those that do not subscribe to the DRP not disadvantaged!
WAX Price at posting:
$1.21 Sentiment: Hold Disclosure: Held
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