Why are shareholders so happy at losing more of their ownership in MUN or their share of MUN's future revenue for a paltry $5 million?
If I was a shareholder believing in the company then I would want the company to issue $5 million worth of shares in total to all shareholders rather than, on my understanding, potentially giving up something like 3% of revenue (before expenses etc.) as a royalty in perpetuity from Torrecillas gold production - plus in the meantime paying 8.5% interest on that $5 million etc.
Just work out how costly getting hold of that $5 million could become.
MUN has about 147 million shares on issue. A 1 for 3 share issue at just 11 cents, fully underwritten by MUN's majority share holder, would have no problems raising the $5 million - and will also not adversely dilute the majority of MUN's shareholders.
But that of course would not be so juicy for AngloPacific Group, would it?
MUN Price at posting:
28.2¢ Sentiment: None Disclosure: Not Held
