RE:It is Private PlacementI hear what you're saying that the stock may have run a bit more once the UK license came in, but personally I think it's already baked in. Still, I want the license in hand so that margins on McBookie can improve at the end of this calendar year and other opportunities open up. Even if this were the case today however, FANS would still be operating at a net loss right now. Something to keep in mind when considering valuations and ability to secure PP. I also don't share the view that the SP was going to be north of 2bucks once the UK license came in, let alone see any evidence that management held such a position. Regardless, available big money ultimately makes the call of what they will invest and at what price. I don't think a short-term bump likely led by retailers would have influenced their valuations, investment thesis, acceptable offer price and expected ROI. I have faith in FANS management that they’ve done their homework on this and will strategically deploy the upcoming new capital in manner that will benefit the company and us shareholders.
Related to that, the decision by the Senate today must have prompted this prepared action that was waiting in the wings. FANS will likely want/need to put things into high gear to secure Canadian market position from a B2C and/or BTB perspective that aligns to some of the purpose statements in the prospectus…”launching and marketing of a new B2C consumer brand; entering into new partnerships and increasing brand awareness” respectively. They don't need additional cash for traditional operational sustainment in the short-medium term; they already have cash to service that need and manageable Q net losses. However, this emergent change in the Canadian landscape means they need cash to throttle up and be a quick mover…also wouldn’t hurt to have some added cash on hand for other acquisitions. An improved float to be nimble will help in this regard.
I do agree that share prices recalibrate based on PP and typically don't trade significantly over the offer price in the short-term...but one only has to look at the brief history of this company to see how quickly this can change; how financing @0.625 was done and then the stock went north of 2bucks. Above 2 didn't make sense then and it still doesn't today, but the conditions for success are / are being established (legal/regulatory) and we've got the tech and professionals for strong and sustained growth into the future for a sound investment play. If the stock pulls back to this new PP price, then this would be a good (re)entry point as this will likely be the new floor.
GLTA.