Doubts about new placement
I read the disclosure, and I wasn't that impressed. 23 cents or about 2/3 of the market value before publishing the disclosure sounds kind of cheap. Granted that long-term development capital in the mining industry is hard to come by these days. This placement begs many questions.
Such as:
Was the capital needed that badly?
Were other options at raising capital less attractive or unavailable?
The company has given itself 4 months to raise shareholder value before this new issuance of shares and warrents hit the market. Is this enough time for whatever the management has in mind?
According to the company introduction:
'Defiance is managed by a team of proven mine developers with a track record of exploring, advancing and developing several operating mines and advanced resource projects.'
But this deal casts doubt on their being good business heads.
I don't own many Defiances stocks, but now I am not so keen to buy more.
take care
rwmccoy