Why did they do this horrible offering?WIth the selling after hours, it is hard not to add some paranoia to the stages of grief we ae dealign with already. So, does anyone have a decent theory about why an otherwise sensible group of people who clearly know better than to issue shares on such awful terms went ahead and did so anyway? Here is my offerings on that but I must not be seeing something and I hope someone else will:
1.) The easist explanation is they have been wanting to do this for a while and thought the bubble was about to burst, potentially cutting off funding for a while. Given that share sales were going on hot and heavy last April at the height of the covid panic, however, that would seem to be a big overreaction to a possible scenario that may not materialize for a while.
2.) When reading the prospectus, it is perfectly clear they are having an issue getting the EMA on board. They are still "assessing their strategy" regarding the EMA according to the prospectus and since they have had so much time to interact with them already, that can only mean there is a high probability of the EMA not giving TH a thumbs up on the phase III. With questions still looming at the FDA, they knew that could call the whole NASH program into question in investors minds and wanted to raise money while everyone still thought all was well on the NASH phase III front. That would be quite a deception but the way things went down with the deal being announced just 2 days after the "good news" on the FDA letter, with no US brokers involved, and on horrible terms led by a second tier Canadian briker, it sure smells like that.
We had said that it was key for Paul and the company to get this phase III thing done or their credibility would be mud. Perhaps this is why they moved to raise money in this atrocious way since they knew their credibility would soon be in tatters?