Quote:"...the Company issued 16,727,900 units of the Company (the “
Units”) at a price of US$2.75 per Unit (equivalent to approximately C$3.51 per Unit) (the “
Offering Price”) for aggregate gross proceeds to the Company of US$46,001,725 (equivalent to approximately C$58,714,929), including the full exercise of the over-allotment option to purchase an additional 2,181,900 Units at the Offering Price.
Each Unit is comprised of one common share of the Company (a “Common Share”) and one-half of one Common Share purchase warrant of the Company (each whole warrant, a “Warrant”). Each Warrant entitles the holder thereof to purchase one Common Share at an exercise price of US$3.18 (equivalent to approximately C$4.06) at any time until January 19, 2024."
These funds bought 16,727,900 + 2,181,900= 19M shares @ $2.75/shares and acquired 9.5M warrants @ $3.18
Let's say they will dump 19M shares on the market at average price of $2.20/shares and keep 9.5M warrants. It would be equivalent to buying 9.5M Jan 2024 call options at strike price of $3.18 for $0.98/shares ($3.18 - $2.20). They will make unlimited gain when PPS goes up from now until 2024, but the most that they could lose would be just $0.98/share.
Whichever funds made this deal are genius and conversely, whoever in Thera negotiated this deal is an idiot !
This deal shows either the level of desperation or the depth of idiocy at Thera. Which one was it ?
What i said earlier! No company is doing such a deal lately! Even obscure firms get 100 M of