FAR 5.66% 5.0¢ far limited

bonus and entitlement options

  1. 1,317 Posts.
    I wonder what FAR supporters make of the announcement after the market closed today that FAR would issue one for one bonus options to those holding FAR shares on 31 July and issue one for one entitlement options at a price of 0.003 cents to those holding now well out of the money July 2003 options.

    I suppose it is good of the company to try to salvage something for July 03 option holders even if they are obliged to pay for the privilege.

    I am not so certain of the reason for the issue of bonus "free" one for one options for those holding fully paid shares on 31 July. If FAR shares are in the money, ie more than 7 cents, come July 2005, the options exercise date then the company's shares will more than double at that time, though the company's coffers will obviously benefit to the tune of $11 million dollars.

    I hold bucket loads of FAR and am a bit concerned that today 's announcement says to shareholders that the company doesn't expect normal operations ie, exploration and production, to lift the share price in the short term so here is a bit of a gift for you to go on with. Perhaps it will entice people to buy the shares to get the free options but I doubt it.

    I am punting on China (Beibu oil discovery) being a company maker for FAR but the development of the field will be slow and tortous. Drilling success there later in the year should be reflected in some interim strength in the share price.

    I thought FAR had enough money to meet its immediate Beibu commitments, particularly as it now doesn't have to pay extra for Banjo. FAR had $1.9 million in cash at the end of March. I hope it has the same or more at the end of June. But today's announcement suggested it wanted some more funds to meet its Beibu obligations.

    Thoughts anyone??
 
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