Whaaaat? Is there a mistake in the release? A CENT?!
You certainly can’t blame Retec for a lack of surprises.
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I don’t think they’ve even decided on the subscription price yet, or the final amount to be raised.
Good guess. This activity is unbelievable.
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Am I misunderstanding, or are the shares essentially just subscription rights for subscribing to new shares starting tomorrow?
So, with heavy dilution, capital is being forcibly called from every owner who still wants to stay in the game? A so-called total washout round.
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I hope I’m misunderstanding something completely. This is a total rip-off.
The general meeting will decide it, of course, but 15 million is being sought and at least 5 million will be accepted. You can practically calculate the subscription price from the requested authorization; the board doesn’t seek authorization for 1,500,000,000 shares just for fun.
Well, time will tell, but that one-cent subscription price doesn’t mean the share value tomorrow will be 1c.
In fact, that one-cent subscription price could be quite good; under almost any terms, the owners will put more (up to 15M) into a company with an 8-million market cap than the current ownership is worth to ensure the offering goes through. However, the lower the price, the more likely it is to succeed. After all, this is a matter of life and death; if they haven’t secured anchor investors by now, they’ll probably find subscribers at one cent. Then again, if the share price halves tomorrow and the market cap drops to only four million, it might not be fully subscribed even at one cent.
Of course, my opinion doesn’t mean the share will rise tomorrow; it could actually go almost anywhere. (Meaning, likely down significantly). The mistakes were made earlier, when they delayed finding a proper CEO. It’s a sad case, but if the offering goes through now, the new CEO will have one more shot at turning this into a viable business. Or perhaps a buyer will emerge, though I consider that quite unlikely at this valuation.
If the price tanks properly, I might put a grand into this; I’ve been watching from the sidelines for a long time.
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I wonder if it goes something like this…
30,000,000 shares (rounding for simplicity) are inflated to 1,500,000,000 shares (rounding this amount too).
The number of shares increases 50-fold. The calculated price for a new share was that 1 cent.
If you own 10,000 shares, you get the right to buy 500,000 new shares at 1 cent/piece, if you dig up an additional 5,000 euros from the bottom of your pocket or a dresser drawer.
Let me put it another way.
If you want your stake not to be diluted in the offering, you throw 50 cents of new good money after the now soured money for every one of your current shares.
The value of your current (e.g.) 10K shares (before tomorrow) is now 2,730 euros. To avoid dilution, you have to dig out almost double the value of your current holding from your wallet.
It’s a tough case. I was already thinking earlier tonight that if the stock really dipped to 1 cent tomorrow, I’d buy, say, 100,000 shares as a bright-eyed scout for a measly 1,000 euros.
But.
After this, I would need 50,000 euros in cash to participate in the offering and for my move to make any sense.
So, for every additional purchase, I would have to be prepared to put in 50x that sum of money to take full advantage of the offering.
In this, the guarantors and insiders might still prove to be quite the boisterous schemers; it’s a curiously designed complex structure (himmeli). I can’t quite get a grip on it, and I can’t evaluate whether it’s a good or bad setup for the average investor. Since it’s been made this way, it’s likely bad.
Tossing and turning over this, I couldn’t get any sleep tonight. Had to vent a bit here. Hopefully, the Sandman has some opioids in his bag on this trip.
Criticize. Roast me. Argue against it. Oh, rant about the wonder of BRETEC. Tell stories dripping with honey and sap about the journey to the stratosphere and then to the moon.
Now, hopefully, good night.
B