The 2008 annual report said there were 5154 shareholders at the time. Lets round that up to 6,000, just to be conservative. Now lets assume that 50% of shareholders elect to participate in the SPP, and ON AVERAGE, participating shareholders take up 50% of their maximum entitlement. So that would be 3000 shareholders subscribing for $7,500 worth of shares each. That would result in approximately $22.5 m flowing into WTP's coffers, which, as it turns out, is almost identical to the proceeds from the institutional placement ($22.61m).
The instituational placement dropped Watpac's gearing from 42.8% to 36.9%, (or just under 6%). $22.5m from the SPP would drop net gearing by another 6% to roughly 31%. My reading is that a net gearing of 31% is entirely reasonable, and wouldn't expect to see any scaling back of allocations.
The REAL question though is what percentage of shareholders will apply, and on average, how much are they willing to spend?
Any comments?
WTP Price at posting:
$1.90 Sentiment: LT Buy Disclosure: Held
