Great points MA, In my experience listed options do act as a magnet for the SP and can certainly in cases hamper short term growth. We all witnessed this roughly 18 months ago with IHL, where many of us here participated in the listed option capital raise event.
Unlisted or performance based options, often don't resrict the SP in the same maner infact it can be a small catalyst as it creates capital usually aligned to and directly funding growth activities essential to the business. These funded activities are usually an indicator of future promise and good news so it can help leverage a new group of investors who have no choice but to buy on market or miss out.
Ofcourse there is also the opposite whereby a business is struggling and requires capital to stay afloat, tho no indications whatsoever here of this issue with IHL and we have very recently seen the balance sheet.
We have also recently witnessed with the good DR Sud and others convert 8c oppies well in the money that had no bearing on the SP, but instead a significant bearing on our business and bottom line.
Short story long, I see any reward to loyal shareholders in the form of options as another very smart decision by the BOD likely putting significant capital and additional shares in sticky hands rather than traditional capital raising events where by offshore traders will take profits and sell out as soon as stop gaps are hit. Potential also for less dilution down the track with any Nasdaq capital raise we embark on, our US investors will trade us like pomemon cards which they are well known to do with small caps.
IHL Price at posting:
44.0¢ Sentiment: Buy Disclosure: Held
