Marion has many thousands of shareholders, only a small percentage blog on HC. On the other hand there will be may traders out there with short positions. With the advent of instruments such as CFDs, it is very easy, even for small traders, to short a stock. Once again a certain percentage of these short sellers will blog on HC.
Even without the disclosures, it is very easy to see who fits into which category. People who hold Marion do so at their own choice, because they believe it's a good investment. Non holders tend to ask questions on these forums to help their research. Short sellers obviously want holders to sell their shares cheaply so they can make their profits and blog accordingly. In the end we have holders who tend to only see the upside and shorters who only see the downside.
Isn't this typical of posts we read on these threads?
After reading the weekend posts, unfortunately it didn't amaze me to see people predicting a sp of 1.7c or 2c after the placement + note issue. Wouldn't it be nice to be able to buy Marion at those levels again! Of course doing some very simple math blows those figures out the window. Some very quick back of the envelope calculations will come up with an equivalent post dilution sp of 3.7c I have shown these rough calculations below. In reality the market has seen this to be a positive. Having the extra $4.2m from the placement + the note facility has greatly improved Marion's viability hence maintaining a premium to 3.7c
pre dilution shares on issue 429m + 170m placement + 68m options = 667m @ 4.2c = $28m + $1.7m (in the money options @2.5c)= $29.7m diluted market cap note this includes the original placement, as the market was aware of this prior to friday
post dilution = 667m + 220m + 88m options + 20m notes (2x250k @ 2c & 3c) = 995m shares/options $29.7m original market cap + 4.4m placement + 2.2m (in the money options @ 2.5c) + 0.5m notes = $36.8m / 995m shares = 3.7 cents
Note: in the money options were included in the dilution, as was the 2.5c exercise price the company would receive. I only included 2 draw downs of convertible notes, the first which was already done at 2c, & the 2nd at 3c (80% post dilution likely vwap) The 1st draw down was for 12.5m shares, the 2nd 8m, further drawdowns likely to be less than 8m so will only have a minor affect on the calcs. Also it is likely they will not draw down after receiving the placement funds after the AGM.
MAE Price at posting:
4.3¢ Sentiment: Buy Disclosure: Held
