4304 days ago
AIM and ASX listed Norseman Gold (NGL) is rubbing salt in the wounds of the private investors it so likes to screw and who had bought the shares before Wednesday’s placing announcement likely feel by increasing the proposed placing by 25% (to Australian$25 million) “due to strong demand” from “institutional investors”.
For once I do not condemn Norseman’s management. This time it is greedy City brokers who should be strung up from lamp-posts with piano wire. This sort of thing is a stockmarket scandal.
This placing was done via a book build. That is to say the brokers (who trouser 5% of funds raised) call up fund managers and say how much stock to do want at what price. So we thought it was A$12 million (plus $8 million loan conversion) at 2.7p. But it appears there was more demand so they issue more stock at the knockdown price. They could have simply upped the price and raised the original amount (rather than an extra A$5 million) at a higher price. But no.
Greedy brokers will have told the company:
