The reason many companies don’t do a SPP is because they cost...

The reason many companies don’t do a SPP is because they cost too much, take too long and cap the SP. Its as simple as that.

Some companies will do them to ‘reward’ or appease retail but in this case it’s justified as management would have seen how VUL traded in the post market and would have been pitched that by canaccord.

Having ‘clean air’ after a raise is important and allows it to trade at a market value vs a distorted value as retail tend to sell into the market to fund their cheaper shares - thus capping it. Sure there might be a few flippers but that holds true for retail, sophs and insto.

From my understanding there is a lot of big news about to drop for EGR in coming weeks/months. Why cap it? Sure, everyone would love buying at 60c vs $1 but it’s not without risk and retail will be better off longer term if good funds get on the register. After all big SP gains are driven by larger volume ie insto.

As for the 60c price. The broker would have wall crossed cornerstone investors in recent days and gauged appetite. That helps to set the CR price so that it gets away - 60c is just a ~2% discount to the 10 day vwap incidentally.

Canaccord were clearly caught out by the large recent price action but $50m is not an insignificant amount. Could it have cleared higher? Perhaps. It closed in less than an hour. I still have no idea if I got a piece or who else got some but allocations are advised tomorrow as I know they kept some for European investors.

Either way the business now has funding which is/was needed, likely high quality new investors on board and has de-risked itself. If I was an existing holder I’d be pretty happy with that, not to mention the very high paper profits most will already be on given recent SP appreciation. GLTAH