Fair value, page-8

That is all good, BUT you are not taking into consideration what management has effectively done in destroying the returns to share holders from the dividends, as long as the company is profitable.

1366 million shares X 0.03 cents = 41 million approx out of net profit (return of dividend) to shareholders. As we all know, management SHOULD NOT have paid this out.
754 million less the 41 million returned to shareholders = 713 million

This equity raising has diluted the company by a percentage greater than 100%
1366 million shares will become in my cals to 2936 million shares outstanding.
Approx 115% increase in the number of shares on issue, hence why Mr Market is selling down the shares under the rights issue price of 0.48 cents.

The company is using the money only to pay down debt. Why did mangament not manage their capital over the last few years better. This money will not be deployed to increase share holder value in the short term.

If you take the equation from the last dividend return to shareholders of approx $41 million dollars / by 2936 million shares = 0.014 approximately (Rounded up)

This in effect means that you must now double your share holdings plus add an extra 15% and hold a massive loss on your existing shares from the closing price on the 12th September 2014 of 0.65 cents. At todays price of 0.38 cents, thats a massive drop of 70%!.

Yes, that is right. For you to get back to the lofty heights of 0.65 cents, your current share price will have to increase by a WHOPPING 70% just to get back to your original holding value.

You can window dress it any way you like, at the end of the day the maths dont lie. Every time you look at those original shares and the price you paid, man o man, what a mess!

If you believe that managment are looking after your interest, then you will believe that UBS will buy lots of shares and get the price back to at least 0.48 cents within days to support your holdings.

Happy investing.

DYOR