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Originally Posted by AlexanderHanff
Another point worth revisiting is the 32M GBP they are expecting to raise in share deals with Morgan Stanley. The deal was I think 1.6M shares at 32M with Canaccord Adams Ltd. and Morgan Stanley with shares placed at 20GBP per share. At the moment the market price is about £12.80 per share.
I wonder how these two new investors are feeling given they entered a deal which has devalued by 40% before it has even been finalised. Do we still think these 2 investors are going to go through with it? Given that the money raised is earmarked for actually setting up the system in the UK, it could prove disastrous for Phorm if they back out at the last hurdle.
Alexander Hanff
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I'm certainly not a finance bod, but I think all these issues are underwritten by a merchant bank. i.e. if these shares don't sell, the bank buys them. It's part of the costs of placing the shares. This time the bank lost! I don't think they can pull out.
They probably started arranging all this months ago, and finalised it when the price was high.