Existing Number of shares on issue: 144,393,865 Price Per share: 34.5 cents Offer: 1 option for every 1 share Rights Offering: $0.001 cent option
Number of New Options to be Issued (1 to 1): 144,393,865 Current Market Value (fully diluted): $0.345 x 144,393,865 = $49.8 million Future Total Shares on issue (after excerised options): 144,393,865 x 2 = 288,787,730 Amount Raised: 0.2001 x 144,393,865 = $28.9 million New Share Price: (($49.8 million + $28.9 Million)/ 288,787,730) = $0.27 cents
Thus after the loyalty option, the shareprice is going to fall from 34.5 cents to 27 cents, a decrease of 21%. The option price is likely to be around 7 cents due to the share is in the money. This provides you with an investment gain on the options of a 70 factor. I'm pretty sure this makes some sense. Correct me if I am wrong.
BMG Price at posting:
27.8¢ Sentiment: None Disclosure: Not Held
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