Yes, and there is a huge difference between unfortunately strategical mistakes (like the abattoir), incompetence (the terms of the D'Alessandro-loan which, hopefully, will not be a major problem + the danger of the toxic loans), and screwing shareholders [actually, incompetence can fall in both categories - if ECAB did threaten to sue SIAF because of a breach, this might be caused by incompetence - at the very least the BOD should consider to step down when they make mistakes based on incompetence again and again]
IMO diluting at 5-10% of book is NOT in our best interest. It would be way better to book a loss through a discount on receivables, than to dilute 20% at 5% (I'm not even sure what we gained, we still owe ECAB 15MUSD).
A discount on receivables could have been used in several ways; 1) Repay ECAB 2) Pay the taxes for the stock dividend 3) Cash dividends Note that point 2 and 3 might have lead to point 1 not being necessary...
Also note that both SIAF and TRW has been using a lot of money on capex in 2017. Sometimes capex is unevitable, but the whole ECAB-dilution might have been able to avoid by not spending capex. Also, even though we shouldn't expect Solomon to give SIAF a loan, it is very unfortunate that he chose to have his 2MUSD loan repaid in 2017 - that's half of the D'Alessandro-loan!
Isn't the compensation-scheme itself a breach on his fiduciary duty? It is, at best, very unfortunate to have a deal where he benefits from a depressed PPS. It gets real ugly when he dilutes 20% at 5% book, breaks promises, don't step up to defend the PPS, and signs a new toxic loan (after having made his compensation scheme as the sole (?) member of the compensation commitee). A proper CEO would make sure to change his compensation so that he, in case the PPS now plummets, will not be accused for deliberately depressing the PPS to get more shares.
Speaking of discount (round numbers to prove a point); *Before dilution; 25 million shares with a book value of 25$/share *Post diliution; 30 million shares with a book value of 21$/share So we lost 4$/share * 25 million shares = 100MUSD from the dilution
Now, this is not a 100% fair comparison, but I would rather have booked a loss of 100MUSD through discounts than be diluted 20% at 5%. A 100MUSD discount would free up 300MUSD (at 25% discount, although that would mean that we had to free up ALL receivables as well as what TRW owes us, so the number isn't correct - our loss would be much smaller) which could be used to repay all SIAFs debt, pay the taxes for the TRW-dividend, start a cash dividend AND buyback shares. The PPS would easily be back at 17$. Instead we are diluted 20% at 5% of book and trading at 0.4$, and we also lost 20% of the TRW-shares (which probably means a lot more in future loss). That doesn't seem to be in my best interest, does it?
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