the vla spp

This thread arises because of some of the angst expressed recently about the SPP; angst over the share consolidation is accepted and the issues discussed on a separate thread.

Why an SPP?

The first duty of management of a company is the company's survival; the next duty is its profitability; contrary to much corporate behaviour, share performance should be a by-product of the second, not the primary end (contrary to what all of us might prefer!)

So it's esssential that VLA has cash on hand not only to remain solvent, but to support its ongoing R & D, including trials and all that is associated with making its mark in oncology. And it has to look in a good position for any decent investment or potential deals; you're in a lousy bargaining position if you look as if you're going broke! So, we need more $$s - simple as that.

Do I want another La Jolla Cove? Not on your Nellie! Neither does the VLA Board or management. They want investors who'll stand by the company, and not keep re-selling for cash flow.

Should the SPP rights have been issued pro-rata to existing shareholdings, rather than with a $15,000 limit?

I suspect too little may have been raised from a pro-rata rights issue, not enough from the "bigger" shareholders, and but a pittance from the 80% of "smaller" shareholders with a present average of 10,000 shares apiece.

Effect of the SPP on the SP?

In the short term, rather tough (usually happens), and on the "bigger" shareholders, a rather harsh dilution. In the mid to longer term, the SPP is absolutely necessary to ensure the basis for the SP to grow on the back of the company's progress, and its ability to attract investment capital.

Glad to hear others' thoughts on this topic also. (I find real value in the serious contributions on HC. What I would like to hear also are contributions about the technology itself - I've been very impressed with some of what I've read on the ADO threads - some very knowledgable posters there.)