Interesting questionThe plan was that Wilan successes were going to fund the acquisition-based growth in ITS. And it looks like Wilan is doing well. Plus, it's a bit disappointing from the perspective of existing shareholders that these new debenture-holders are going to get a piece of the action if / when the news comes on the Apple appeal (though good news is not certain).
So why was there a need to deviate from the plan, especially given the Motorola settlement and the $50 million that remained in the bank following the purchase of ETC? Also, one could argue that it would have been better to do the issue AFTER the release of Q3 results, now less than two weeks away.
In particular, was there something wrong (or at least unanticipated) with the original plan to have Wilan successes fund the acquisition-based growth in ITS? Why this sudden need for dilution?
I suspect there were two things that were unanticipated. First, the degree of availability--and, in particular, the availability short-term--of certain compelling acquisitions at okay enough prices.
Second, it may not have been fully anticipated back in 2020 the level of urgency there might be to get up to a certain scale for the sake of competing successfully on big tolling contracts. If there's some monster tolling project where ETC has been informed that their proposal will be better received if they can fill in some perceived gap in their offering then, for sure, a little dilution is nothing.
I had a curious exchange (related to this subject) yesterday with one of my Bay Street friends. I suggested there may be an acquisition announced in fairly short order, perhaps even before Q3 numbers are released. His response was interesting. He basically said there was no way an acquisition would be announced before Q3 results because if it turned out badly then the new Bay Street investors would be unhappy. My response to that was that everyone knows another acquisition is coming--that's what the new investors are signing on for. My friend and I left it unresolved.
Anyways, this seems to me the current $64k question. Will there be an acquisition announced before, or concurrent with, the release of Q3 results. I suspect management would like that. Of course it might simply not be possible for things to proceed that quickly.