Hello. Its not the company that usually sets the parameters. Its usually the brokers. Dependent upon the stage of a project, there are benchmarks. MTM is not my cup of tea. Its a technology thing. But for a mining explorer, there are benchmarks.
For example, RDN in the three weeks prior to its last capital raising was trading on a VWAP of around 4.3 cents, which valued the company at around $120M. No capital raising was expected. Then RDN suddenly announced a $10M capital raising at 3.2 cents, which resulted in a market cap of.... wait for it..... $100M.
This is how, in my impression, brokers value a capital raising. The brokers say to RDN we think your exploration company is overvalued at $130M and we will only get our clients to fund you at a $100M market cap.
But, as I said, MTM is not a exploration company. If a strategic investors wants in then the capital raising price can be anything.
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