Wishbone Gold Plc Raises £1.75 Million Through Discounted Placing
Why we think this is bad
The significant 16.13% discount at which the new shares are being issued suggests that the market has low confidence in Wishbone Gold's prospects. The substantial 57% dilution of existing shareholders' holdings is also a negative signal. While the additional working capital will allow the company to continue its exploration activities, the need for this discounted equity raise may indicate that the company is facing financial difficulties or struggling to secure alternative sources of funding, which could further undermine investor confidence.
Key Points
- Wishbone Gold raises £1.75 million through a discounted share placing
- New shares issued at 0.13 pence, a 16.13% discount to the previous closing price
- Proceeds to be used for the company's gold exploration activities in Australia
- Substantial 57% dilution of existing shareholders' holdings
Summary
Wishbone Gold Plc has raised gross proceeds of £1,750,000 at a placing price of 0.13 pence per share, representing a 16.13% discount to the previous closing price of 0.1550 pence. The proceeds will be used to fund the company's gold exploration activities in Australia. The discounted placing and substantial 57% dilution of existing shareholders' holdings suggest low market confidence in the company's prospects.