Keep in mind that other company also placed shares to a reputable firm during a downtrend and the sp continued down. Today a fraction of that last placement price.
Placements below a certain percentage of the float have no requirements for the party to disclose. This is the choice of the private party, not ERHC.
We shouldn't forget that the last placement led to Chad either. So whatever the cost or debatable effect on the share price, we don't know the benefit yet.
But let's not have the shelf debate again please, lol. I think we covered both sides of that one.
We'll see what detail we get on the 28th. If the proposed Rights Offering idea is not complete we may not hear much. I have no idea. So we're getting ahead of ourselves here.
But I can't agree with:
then this is all a game to remove retail shareholders from the picture.
I think it's a plan to raise money to explore and acquire assets to build shareholder value. Preferential terms always go to Institutional Investors and JVs. They put up more money.
But retail investors are also key to any share price appreciation. And even if a shareholder doesn't buy another share and all the shares are authorized and then issued, they are not "removed", their ownership percentage and voting rights are reduced by up to 3/4.
But how this affects the eventual value of the remaining percentage depends on what the company does with the money. If they discover oil and buy development and production stage assets, the diluted shares are worth far more than they ever would have been undiluted. Even just raising the cash improves the standing of the shares, at worst it's book neutral. If there is zero dilution and zero proven oil, they have no intrinsic value, just the cash on hand.
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