I think you're very close in your thinking that the underwriters played a pivotal part, but perhaps not in the way that you thought and certainly not (imo, as supported below) in relation to the level of participation of the founders during this raising. Let me explain.
My view is that the overall split between shares allocated to the direct Placement (instos/sophs) vs. Entitlement Offer (existing SHs, including instos and retails) was fundamentally dictated by the risk management requirements of the underwriters. That's the first order of business, imo, because without securing the support of the underwriters nothing else can happen - especially in this current environment.
To expand on this, the temporary relaxation of the 15% placement rule (increasing it to 25%) without requiring shareholder approval also worked to allay the underwriters' concerns to be risk-exposed for the minimum amount of time possible - especially during a high-volatility environment. The more the underwriters could offer/place directly to instos/sophs the better because the book build for commitments is generally done within a very short time frame (~24 hours in this instance). The underwriters' at-risk period was further reduced by including the Institutional component of the Entitlement Offer into the same book-build period. This meant that the vast majority of financial commitments relating to the raising were locked-in within ~24 hours, leaving ~20% ($138m) relating to the retail portion to be at-risk for the underwriters for an unavoidable extended period (5 weeks - 6 April to 11 May, per event timetable).
It's important to keep in mind that all of the above would, imo, have operated independently to the founders' intentions regarding their final financial participation pursuant to the Entitlement Offer. That's not to say that discussions around that issue didn't occur; it's just that, as circumstances dictated, it became a separate issue, which I'll touch on now.
The supporting notes and calcs (below) hopefully make clear the math of how it all operates. Note no separate mention of the founders' participation levels because their Entitlements of ~24.4m shares (~$175m) would have been included in the overall Entitlement Offer bucket of 58.2m shares (because they were existing SHs). Moreover, it would have formed part of the 39m-share Institutional Entitlement Offer sub-bucket.
We know they will be tipping in $25m, leaving a $150m shortfall and it looks like the underwriters have already found a home for that shortfall. How so? Because the 'Completion...' announcement on 07/04 stated that ~$562m was actually raised from Institutions, which this shortfall amount would have formed part of. (It would have been classified as Shortfall Placement, which isn't counted toward the 25% limit that applies to the initial (direct) Placement. (Clear as mud...)
None of the above comments attempt to answer why the founders only chose to tip in another $25m of their $175m available entitlements. However, I think it does demonstrate that it wasn't about the underwriters wanting a larger slice per se because they (the underwriters) were already banging up against the 25% (direct) Placement limit (per below). I can understand why some people (not you) might think that not fully participating amounts to a vote of no confidence by Skroo and the other founders, but I think that's rubbish and fails to consider the much broader history of performance and alignment with other shareholders over the decades. For me, it's most likely because there probably was not the capacity to tip in another $150m. When you've got that many years of performance and co-alignment with other shareholders that you can to point to, nobody should (imo) begrudge any of the founders, especially Skroo, in diversifying their wealth beyond their holdings in FLT, regardless of what dividends they have been received over the years.
Nice spotting wrt the fact that the founders' limited participation will result in them being diluted from ~42% collective ownership to 23% when all this is done and dusted. Even if they had fully participated they would have still have been diluted by 20% (due to the dilutionary effects of the direct Placement), meaning a max. possible ~33% collective ownership when the dust settles.
It's gotta hurt more than a little when you've been a committed (now 70yo!) managing founder who has put decades of effort into his 'baby' to have an external event like this come along at this stage of your career, only to find this is what it takes to preserve it. Yes, he's a multi-millionaire and, yes, there's little chance he's gonna die destitute, but that's not really the point, is it? He and the team have made a very valuable contribution to many shareholders over the years and I think it's worth acknowledging and respecting that. (These particular comments are not aimed at you, @hcosah; they're for everyone else reading this.)
I'm still of the view that the broader equity markets are miles too overconfident, but that's just me. I prefer to stay well-clear of the low-rent drivel-athon that is propagated by both sides of the bull/bear argument, but I did want to constructively input to your nicely written and insightful post.
Cheers, Z
****************************** Supporting Notes and Calcs: After obtaining informal feedback from the market that it was (presumably) more than comfortable providing $500m @ $7.20 the raising was upsized to $700m. This meant firm numbers around whom would be offered what could then be calculated (i.e. $700m / $7.20 = new 97.3m shares to be offered).
Old SOI: 101.1m shares. New Shares to Issue: 97.3m shares ($700m / $7.20; rounded actual, based on announcements). Total New SOI: 198.5m shares.
Split of 97.3m New Shares (39.1m - Institutional Placement; 58.2m - Entitlement Offer): Institutional Placement Component: 39.1m shares (actual, based on announcements; represents ~24.5% of 159.3m shares (i.e. 101.1m old SOI + 58.2m total new Entitlements - see next), being just under the temp increased 25% limit <- important point and not by accident, imo).
Entitlement Offer Component: 58.2m shares (actual, based on announcements; includes existing intos and retails; further split into sub-components). - Institutional Entitlement Offer Sub-Component: 39m shares (derived by subtracting 19.2m from 58.2m). - Retail Entitlement Offer Sub-Component: ~19.2m shares (derived from $138m retail amount announced on 07/04).
Institutional Book Build (comprised two components; locked-in over ~24 hours): - Institutional Placement Component: $281m (39.1m shares). - Institutional Entitlement Offer Sub-Component: $281m (39m shares). Total Book Build Commitments from Institutions: $562m (dollar value confirmed in 07/04 announcement).
Retail Entitlement Offer Sub-Component: - $138m (19.2m shares @ $7.20; ~20% of overall CR that underwriters carry risk on for any more than ~24hrs).
(20min delay)