I appreciate you sharing the details of your phone call with Scott, and actually i have no qualms wrt raising sufficient funds to ensure the company can meet any contingent throughout and beyond the drilling of this well, especially with it bearing 100% of costs. But i do have a very serious issue with how this has been done. I'll give you a few examples of my issues with the Company, on this and the prior issue involving new options: 1. If you correctly quoted Scott re his (?) remark that this is "purely an exploratory well". So the ASX announcement (6 June 2023) that referred to M-2 as being an "appraisal well and phase 2 exploration", is clearly somewhat a little white lie? (As it is i found it difficult to accept that an "appraisal well" some 6.8 kms distant from M-1was truly an appraisal well, but obviously it was a desirable coin of phrase when seeking extra funds for the drilling of M-2).
2. In that 6 June 2023 announcement it states: "“Combined with our previous private placement in April and the recently completed Share Purchase Plan, Invictus has now raised a total of $35.4 million to which sees the Company’s upcoming Mukuyu-2 appraisal well funded for our next phase of operations in the Cabora Bassa Basin."
Whilst some could argue it being ambiguous i have no doudt that the "well" relates to the prior word "appraisal ", and NOT to be assumed "well funded". Therefore i believe this was a deliberate statement of fact implying funding was sufficient. I can accept though, that he may have had second thoughts about that afterwards and then decided to seek funds - only those privy to board discussions, perhaps minuted, could confirm whether there was an intention at the time (June) to seek further funds close to spud.
3. As Garp quite rightly remarked in an earlier post on this thread, you really need to question the validity of the remarks in the recent ASX release (8 Sept 2023) pertaining to the miscalculation of placement capacity being an oversight that " In preparing the Company’s notice of 2023 Annual General Meeting, it has become apparent that the Company inadvertently breached its maximum placement capacity in relation to its placement, announced on 6 June 2023."
At the time i actually believed the Company line, mainly because having been a director of 2 public listed companies previously in a previous life i certainly would never have made such a statement that IMO is misleading if not a complete fabrication.
4. The previous CR concluded 6 June provided a new set of options. And as to be expected that brought an extra line of securities which IMO actually has competed head to head with the existing fully paid shares ie in other words has attracted a lot of interest by investors/traders. As a result IMO the share price failed to rise to what it may have if there were no options. Thus this additional CR currently underway has been priced on a share price that was already negatively affected by the first option issue. Existing shareholders thus lose out, even though they may have had some options as a sweetner. My point with this is that IF the board had already decided they would seek additional funding (as of now) at the time of the first option issue in June 2023 I don't believe they have optimised the CR's at all. Especially with the slick marketing of the 'huge Cabora Bassa basin" being the "last frontier" of African onshore O&G exploration so to speak.
5. Tranche 2 of this funding, which is subject to shareholder approval at the AGM (yet to be arranged, but possibly end of October or early Nov) is not done and dusted. Not just because of it being dependent on shareholder approval (since Scott holds 70 odd million shares I'd say it's a tick the box exercise), but IF there were issues in drilling, or something else of concern, I'm sure the placees would withdraw from the funding - note (and as to be expected) this isn't underwritten. So despite Scott's apparent comment in the case of an issue through the course of drilling its better to have the funds, IMO its definitely not guaranteed whatsoever - especiallyif the share price is below 15 cents plus option arrangement! Sort of a "Clayton's " tranche 2 funding (only assured when everything's going great!).
6. I wonder how many sophisticated investors woukd dare stay involved, even for the first $7.5 million tranche 1 funding. I can expect a lot of these investors selling heavily from soon after (or maybe before?) spud.
So from that you can conclude I'm not happy Jan!
IVZ Price at posting:
20.0¢ Sentiment: Hold Disclosure: Held
