Equity is more costly than debt.
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Not in this company.
The dilution to existing equity from the cap raising will be costly
Sp now $2.20.
49.6m shares issued - let's assume CVT needs to raise minimum of $50m to keep the banks happy?
So $1 per existing share to be raised.
So 1 for 1 rights issue at $1.00?
Now if the banks require full repayment - will have to be a 2 for 1 at 45c?
Certainly the underwriters will want plenty of margin of safety!
Blood on the floor here.
When the tide goes out, you can see who is swimming naked....