Stephen Industries has indeed guaranteed up to a maximum of 5 MEUR. Not 15 MEUR. So, at least until December, operations will continue with that money. Costs must, however, be taken into account. Edit. correction already came.
Where would the 3-5 MEUR costs of the offering come from? So, from that certain 5 MEUR, only 0-2 MEUR would remain in cash? Operations would thus cease in June-September if no one else subscribed? According to the announcement, some management will participate in some way. And presumably, some small and larger investors will participate if they donât throw in the towel.
Subscription guarantees often incur high costs, but now Stephen gets their 7.5% guarantee fee in shares. And no other intermediaries seem to have been announced. Of course, the organizers of the offering charge their own fees.
No matter what, I sincerely hope that Finnish innovations succeed.
I was referring to the costs of 3-5 million for a 15 million offering. There were no exact figures available, but for example, in similar offerings in Sweden, they have been in that range if there is a guarantor involved. I can, of course, dig up the numbers at some point; I donât remember if Bioretecâs offering prospectus had an estimate of the costs.
It would, of course, be good if they stay below my estimate.
Well, I couldnât quickly find support for my rough estimate now; the arrangement, marketing, listing, etc. costs are often not itemized. Letâs drop the cost estimate to around 10% now, with the majority being the underwriting fee. Its size remains to be seen, depending on the success of the offering.
However, letâs say that if someone, like Stephen, intends to take this over, now is the time.
If the offering doesnât sell well and the subscription rate remains at around 30%, by subscribing to the secondary shares, oops, you now have 70% of the company, and the price is just the cash put into the company.
The price of the share at least does not indicate much enthusiasm among current owners.
Bioretecâs CEO Sarah Hubar-Fisher was interviewed by Antti.
Topics:
00:00 Introduction
00:12 Offer reason and terms
02:25 Focus on commercialization
03:08 Product development pipeline
04:26 Where do we stand after the offer?
Quite a difference between the new and old shares. Trading volumes are small, of course, but the old share is trading at roughly 3x the price of the new one.
What are peopleâs thoughts at the moment, are you going to participate in the offering or not? Iâm trying to form a neutral picture of where we stand. Naturally, thereâs deep disappointment with the losses incurred, and itâs not at all out of the question that ownersâ wallets might be tapped into again in the future. Whatâs the forum consensus, how much will the offering raise; 5, 10, or 15 units of currency? Of course, thereâs also significant upside here, and the product is still presumably interesting. As things stand, Iâm leaning towards participating in the offering, but I wouldnât put my very last pennies into it, letâs just say that.
Just to add to my previous comment, Iâm guessing that Ilmarinen and other major owners will join in after Stephen. They donât seem to have many other options? So I think weâll get about 10-15 (Finnish markka) in total from this.
I wouldnât bet my head on it. Typically, owners like Ilmarinen give a subscription commitment in advance for at least their ownership share in an offering like this, which in turn facilitates the success of the entire offering.
The almost complete absence of subscription commitments from large owners doesnât inspire much hope in me. Ilmarinen has probably already drawn a red line over the entire ownership.
I (as mentioned earlier) bought warrants for about 2 cents each, even though they have also pretty much drained to zero from their starting point of about 20 cents.
This offering is interesting; based on the warrant price, it seems that the offering will largely fail. Now that the price of the share purchasable with warrants is about 1 cent, and Inderesâ target is 1.8 cents, and the share is about three cents, it will be interesting to see how the price reacts to a potentially poorly selling offering.
However, there will be 48 times the number of warrant shares compared to the old ones, so the value calculated through them should be closer to the truth than the current share price. That would be an 80% upside relative to Siltanenâs estimate from that 1 cent when starting.
I wouldnât trust that even nearly all big investors would put 48 times more money into the company compared to the current value of their ownership; they might as well write it off as zero, as almost all of them have paid about a couple of euros each for them at some point. If that last cent is now lost because they donât want to waste more on this, it doesnât change the overall picture anymore.
Still, I would say that even with a poorly performing offering, this company, with its patents, could easily be worth about one cent per share with warrants. That would provide almost a cent of cash and patents thrown in. There is also business, although a credible path to profitability must then be built in just a few months if the offering stays at five [million]. At the same time, a dominant major owner would emerge who could then sell the entire package to someone if desired.
Yeah, these are the creations of us lazy wind-pant wearers. The same thing happens in some form in every rights issue. Time after time.
This is certainly partly due to the fact that analysts cannot stab their paying client (the arranger of the issue) in the back and say directly (e.g. today) to sell the old shares at âŹ0.03 and buy three times the amount of new shares for âŹ0.01.
Or pocket the arbitrage profit and just buy the same amount back at a third of the price.
The series will be combined at the end of the month. And at the latest then, the shares will be exactly the same price.
I was already going to buy a few thousand shares today for âŹ0.007, but it didnât work for the equity savings account.
The idea was to pay 40-50 euros insurance for a week, in case something positive started to happen with the narrative changing. At the same time, I would have given myself the option to buy or not to buy with my rights.
I ended up buying 20% of the new shares (BRETECNO126) of the original amount of shares I had considered.
If this goes as it currently looks, there might well be more buying opportunities at levels 0.009 â 0.008 â reverse split and a few tens of percent discount on that.
And if the news flow gets wild, Iâll be in it again with a small pile, and Iâll buy even if the price goes up. If thereâs a reason for it.
It will be interesting to see what the final destination of this contraption will be.
