I wouldn't say I'm upset with the deal. For me the deal simply reveals information and sentiments that weren't previously clear.
The fact that the raise was done at a 33% discount to market price means that no institution was interested at investing at market price, or at a 10% discount to market price, or a 20% discount or even a 30% discount. This was the best deal that IMU could find - and it was pretty poor.
And the fact that IMU agreed to the deal at that price reveals that they were fairly desperate for the cash. They clearly don't have a specific acquisition in mind otherwise they would have revealed it along with the raise.
To my mind they are concerned about the progress with the current trials and they are building a contingency fund to acquire additional IP if the current IP doesn't prove to be as good as hoped.
They obviously won't say that they are concerned. It is their job to sell our IP to investors as best they can. But actions speak louder than words.
I'm still in for the gamble, but for me there are other stocks on the ASX though that offer a better risk/reward profile. My biggest holding at the moment is a mining/exploration company with a $100m market cap sitting on a lithium deposit valued at over $10b. All they need to do is dig it up, concentrate it a little and ship it to China. That has some execution risk attached but it isn't like they have to cure cancer!
IMU is currently 10% of my portfolio. I get quite concerned when I hear of others with more than 50% of their portfolio in IMU. Hopefully they end up doing very well out of their investment but I fear that some don't quite grasp the risk they are taking.
IMU Price at posting:
22.0¢ Sentiment: Hold Disclosure: Held
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