Why The Coincidence? What I gather from all the discussion is how unusual it was to have the Definitive Agreement and the fianacing announced at the same time. Both are very material announcements.
Many have said that the announcement of the Linamar DA should have been made before the financing to gauge the market reaction before announcing the financing, thinking the market would take it positively and be able to price the offering more favourably. Obviously, those are the folks that think the DA was a positive bit of news.
retired@45 suggested that as part of the agreement Linamar required EXRO to have adequate capetalisation and that may very well be the reason of the coincidental announcements.
For me I'm not sure but I'm convinced there was a good reason to make these announcements at the same time. Perhaps our executive team thought the market would react unfavourably to the DA announcement and decided to "strike while the iron is hot"? I'm not sure about their reasoning but I would really like to hear their answer to the question; why announce both the DA agreement and the financing at the same time?
Now, I have given some thought as to whether we needed the cash or not. I have concluded that there is a good reason to inject some cash in to the "business" of EXRO at this time. With the imminent start of production comes the start of carrying an inventory of materials to produce our products, the start of carrying inventory of finished product pre shipment, shipments to customers and the waiting to be paid and carrying receivable on the books etc. That soaks up a lot of cash folks and in the absence of a banker offering up decent terms on a LOC there's no other option but to self finance.
So, I get why we needed some dough but still there is a bitter taste that resonates on my palate about the timing of these two announcement which makes them hard to swallow.
finest regards
thefourth