GREY:TRIAF - Post by User
Comment by
aagoldon Nov 30, 2011 10:43am
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Post# 19278543
RE: $1.1mm for a section at Lochend
RE: $1.1mm for a section at LochendAIGSwap,
If you really think TOL was worth $5.00-$6.00 per share before the recent dilution, what do you have to say about them selling about 28% of the company for $2.10 per share? Here's how I calculated that: 31.3M shares before the new issuance / 43.2M after new shares issued = 72%. Can this transaction in any way, shape, or form be described as *accretive* to existing shareholders? Seems highly improbable - I'd love to hear an explanation from management.
They say they're going to use the cash to "expand and accelerate the Company's Cardium oil drilling program at Lochend, Alberta and for general corporate purposes". Ok... so why couldn't they use cash flow from existing operations and some of their credit line to exapnd the Cardium oil drilling program? Yes, the cash raised allows them to expand their operations much more quickly, but does that justify them selling 28% of the company at about 38% of fair value (using $5.50/share as fair value)???
Somebody please explain this to me!