The company was for me more of an asset than profit play.
As the company has now released its 1/2 year results I should be a happy shareholder. Before the release the shares were 33-32p. And in the release the net assets were 42.3p a share. Happy shareholder.
However on the day of the release management chose to issue 120m shares, into a base of 303m at 25p a share. In short almost 40% more shares at circa 25% discount to the share price.
On a very broad brush calculation my shares which were asset backed to 42.3p are now down towards 37p.
Before this the market discounted from the asset valuation by about 20%, and this continues to be the case.
Now the rationale for this share issuance was the opportunity to acquire a fund management role and boost AUM. But I am in all honesty hard pressed to see that the opportunity was worth me giving up 20% - 25% of my current value for a future opportunity.
I am further disenchanted to note that the Board all got to take part in the placing. They got the cheap shares that they denied me in an accelerated book build.
So this looks to me to be very much a case of cigars all round, pats on the back for the insiders and management profiting by taking value from retail investors and passing it too themselves.
I am old enough to recognise that management will often profit ahead of retail investors. But its not often that I see them eating their cake and then taking a slice of mine too.
My complete lack of trust in management makes this a sell for me.