BDL 0.00% 13.5¢ brandrill limited

Brandrill- Shareholder discontent

  1. 235 Posts.
    I have re-read the article in the Age regarding the shareholder action against Brandrill.

    This is the way I interpret the article. The company is making a $7.8m rights issue to shareholders, a placement to raise $5.1m, and a debt conversion issue. All involve the issue of mandatory converting notes. "The fairest way to proceed is clearly to invite existing shareholders to subscribe additional capital to the company in proportion to their existing shareholdings. In this way nobody who wishes to support the company need be diluted and, in this respect, the terms of additional securities do not greatly matter ..."

    Although many existing shareholders will not want to take up the new stock offered to them, their view is that if you are going to offer notes and options at such a discount rate then you ought to be obliged to offer them ALL to shareholders in the first instance and only if shareholders decline should you be looking at
    offering them to outside investors and the directors.

    It is good to see some shareholders who are not prepared to stand back and watch the value of their existing equity being transferred to others by way of these resolutions.

    Shareholders are the owners of all public companies. They are the ones who should stand up and be counted when they do not agree with what the directors are doing. If more people took this kind of action we might not see so many Bond Corporations, Onetels, HIHs or Harris Scarfes."
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Currently unlisted public company.

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