I suspect that the major shareholder is concerned that he would have lost his $154.5m invested in PPG if he hadn't stepped in. He was also actively buying up shares over the last 2 years.
The turnaround required is massive and I suspect that the major shareholder has tipped in and has underwritten the raising to gain greater control and eventually take the thing private. The remodeling required is best done outside of public scrutiny.
The numbers are not pretty. If all shareholders take up their allotment the business will have a market cap of $54.4m with no debt. the major shareholder will be in for $171.6m that means he has toasted $140.5m and keep in mind the business is still not generating a profit!
The savings that have been put forward for a $400m business doesn't in come close to where the profit should be.
This will be private before any shareholders see a turnaround.
It will be interesting to see where the SP trades once it is released.
PPG Price at posting:
63.5¢ Sentiment: None Disclosure: Not Held
