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hey, if you read the original SGX announcement, $0.117 might not be the resistance because Advance Opp Fund has only converted $250k worth of notes. There is still $2.25m to be converted by this year if I am not wrong, have to check the announcements.
Point is:
If Advance Opp Fund converts the notes, which it will, there will be more and more shares in the system causing earnings dilution.
The method for calculating the conversion price (90% of 5 day average price) means that it is in the interest of the Company for a higher share price, so that a smaller stake of the Co is claimed with each tranche of conversion.
As newspapers have put it, equity linked notes are "toxic". some of the local blogs have also covered it. When BT covered Transcu's notes, the reporter also called it toxic. The above 2 points show that unless there is someone willing to shore up the price, a downward spiral is almost inevitable.
That is unless of course Transcu's pdt completes phase 3 trials (which it has yet begun) and starts selling them like hot cakes to fund its operation.
Like someone mentioned. It is burning cash at the rate of $2m monthly.
I have deemed interest.
cheers
Conversion Price of S$0.117, maybe tis the support?
PROPOSED ISSUE OF 1% UNSECURED EQUITY-LINKED REDEEMABLE STRUCTURED
NOTES DUE 2014 BY THE COMPANY TO ADVANCE OPPORTUNITIES FUND
All capitalized terms used and not defined herein shall have the same meanings given to them in
the announcements dated 30 March 2009, 11 May 2009, 2 June 2009 and 16 September 2009
(the “Announcements”).
The Board of Directors (the “Board”) of Transcu Group Limited (the “Company”) refers to the
proposed issue by the Company to Advance Opportunities Fund (the “Subscriber”) of one per
cent. unsecured equity-linked redeemable structured notes due 2014 (the “Notes”) with an
aggregate principal amount of up to S$80 million (the “Proposed Issue”), and the Announcements
made by the Company in connection with the Proposed Issue.
The Company wishes to announce that the Subscriber has exercised its right to convert an
aggregate principal amount of S$250,000 in respect of the first sub-tranche Tranche 1 Notes at the
Floating Conversion Price of S$0.117.
The Floating Conversion Price is based on 90% of the average of the five consecutive closing
prices per share of the Company on 9, 10, 11, 14 and 15 September 2009, as traded on the SGXST,
and in accordance with the terms and conditions of the Subscription Agreement dated 30
March 2009.
To date, an aggregate amount of S$250,000 has been converted by the Subscriber, leaving an
outstanding balance of S$2,250,000 in respect of the first sub-tranche of Tranche 1 Notes yet to be
converted.
The aggregate number of new shares allotted to the Subscriber is 2,136,752 ordinary shares in the
capital of the Company (the “Conversion Shares”). The new ordinary shares arising from the
conversion of the Notes in aggregate do not exceed 50% of the share capital of the Company.
Subsequent to the allotment and issuance of 2,136,752 Conversion Shares to the Subscriber, the
Conversion Shares will be listed and quoted on the official list of the SGX-ST with effect from 9.00
a.m. on Tuesday, 22 September 2009.
Shareholders should take note that the in-principle approval from SGX-ST is not to be taken as
an indication of the merits of the Conversion Shares, the Proposed Issue, the Company, its
subsidiaries or their securities.
None of the Directors or substantial shareholders of the Company have any direct or indirect
interest in the Proposed Issue.
BY ORDER OF THE BOARD
TRANSCU GROUP LIMITED
Tasuku Okubo
18 September 2009
the structured notes are really quite bad... only companies who can't get funding from banks tend to go for those kind of equity issues...
If you read their sgx announcement carefully, the conversion formula is in tranches and the number of shares to be issued at conversion is calculated at 90% of past 5 trading day closing price (not quite sure).
What I am sure of is at this rate, if Transcu's price doesn't rise fast enough, advanced opportunities fund can become a substantial shareholder (they cannot convert to the extent where they own more than 50% of share capital).
http://sgxstockpicker.blogspot.com
any idea why need so many ID, it cost $, every mth burning ~US$2m, they shld try to save $ every means
The Board comprises:
Mr Hironori Aihara (Non-Executive Independent Chairman)
Mr Akihiko Matsumura (Chief Executive Officer and Executive Director)
Mr Tasuku Okubo (Executive Director)
Dr James Morley Anderson M.D., Ph.D. (Independent Director)
Mr Alexander Meigs Haig, Jr. (Independent Director)
Mr Alexander Patrick Haig (Alternate to Alexander Meigs Haig, Jr.)
Mr Richard Lee Armitage (Independent Director)
Mrs Lee Suet Fern (Independent Director)
Mr Lim Ho Kee (Independent Director)
Mr Lim Kok Hoong (Independent Director)
Mr Kensuke Hotta (Independent Director)
But look fragile this baby. I'm still waiting for it to break 0.12 before collect.
ZhanShen
very strong support at 12cts. I think the lowest alredi lah.
next week going up.
This one may have some more bandwidth to drop some more.
See next week how.
Wait fr it to be cheaper abit first.
this structure note is not new, it was announced way back in May
the notes really tat bad ????
12.5 cleared, 12 to go
lt does not look good. 10 coming liao
haha u already answer me. Thanks.
ROI25per ( Date: 17-Sep-2009 10:46) Posted:
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dunno , but will consider below 10
good or bad?
ROI25per ( Date: 17-Sep-2009 10:27) Posted:
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PROPOSED ISSUE OF 1% UNSECURED EQUITY-LINKED REDEEMABLE STRUCTURED NOTES DUE 2014 BY THE COMPANY TO ADVANCE OPPORTUNITIES FUND
sufficient for the burn rate til 2012 product launch