FAS have no doubt done another placement under their "death spiral" facility with Gurney Nominees and a 3B advising this will probably be lodged with the ASX late tonight. This spike in volume inevitably follows the placement, which is usually advised to the ASX a few days later.
The death spiral shares are issued at a discount to 5 day vwap of 20% so it seems Gurney are usually busy unloading their placement into the market as soon as they get it. This has been the pattern all year. The real mystery is who is Gurney selling to as no substantial shareholder notice has been lodged.
Yet another mystery with this company.
The problem is that with a cash burn of over $500k a month and no money, with the share price where it is, FAS will have to be placing about 80m shares a month to Gurney to keep afloat, that is even before they think of paying interest on their ever increasing debt. Their 15% head room must just about blown, but that is probably the least of their problems.
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