Chronological list of Covid-19 capital raisings

May 25, 2020

Here is a reverse chronological list (based on retail closing date) of capital raisings above $20m announced in 2020 after the Covid-19 crisis hit, including ratings out of 10 for completed offers.

June 18

United Malt (UMG)

$140 million placement at $3.80 followed by a $25 million SPP at the placement price or a 2% discount to VWAP over the last 5 days of the offer period. Was priced at an 11.4% discount to the last close of $4.29 and the stock closed at $4.10 on May 15. With almost 13,000 shareholders, the theoretical maximum in SPP applications is around $400 million.

June 12

Panoramic Resources (PAN)

$90 million raising at the heavily discounted price of 7c comprising a $29 million placement and a $61m 1.15-for-1 non-renounceable entitlement offer at 7c with retail shareholders limited to "overs" of 50% of entitlement. Western Areas is entering as a 19.9% shareholder via the placement and a priority entitlement to the retail shortfall. Last trade was 12c so this 41% discount is a terrible deal for retail investors who get heavily diluted, particularly those who don't participate. 3/10

June 11

Breville (BRG)

$94 million placement at $17 followed by a $10 million under-written SPP with no VWAP alternative. UBS and Goldman Sachs are joint under-writers and Solomon Lew's interests have declined to participate so will be marginally diluted down from current 33% stake although the raising only represents 4.7% of existing capital. With about 3400 retail shareholders the maximum SPP application is around $100 million. Seems a bit rough to limit the SPP to just 9.6% of the raising, particularly when the Lew interests are not participating. Placement completed in record time after being launch at 6.45pm on May 13 and then with completion announcement lodged at 9.06am on May 14. Stock above $20 as SPP launched so likely to be over-subscribed.

June 9

Incitec Pivot (IPL)

$600 million placement at $2, an 8.7% discount to previous close of $2.19 followed by a $75m SPP at the placement price or a 2% discount to the 5 day VWAP. Around 40,000 shareholders so theoretical SPP maximum of $1.2 billion and they have been allocated 11.1% of $675 million raising. This is around the 30th largest placement of all time - see full list of biggest placements. Wrote to them on May 11 requesting a range of transparency measures including maximum disclosure in the placement completion announcement. They revealed that only $12 million went to non-shareholders.

June 9

Nickel Mines (NIC):

A $231 million non-renounceable 1-for-3.6 entitlement offer at 50c to fund Indonesia expansion. Priced at an 11.5% discount to the previous close of 56.5c and retail shareholders can apply for unlimited additional shares. The $179m institutional component was 75% subscribed by existing holders, which is lower than average, meaning new holders picked up at the shortfall at 50c with no compensation paid to non-participants.

June 2

Credit Corp (CCP)

$120 million placement at $12.50, an 11.6% discount to the previous close of $14.14. To be followed by a $30 million SPP at the placement price or a 2.5% discount to the VWAP over the last 5 days of the offer. Made this allocations announcement given placement exceeded 15% and disclosed that 12% of the placement went to new shareholders. The company has a history of scaling back SPPs after it did a $125 million placement in April 2019 and proposed to cap its follow on SPP at just $10 million, but then expanded this to $15 million after strong demand of about $40 million. Wrote to them on April 29 requesting the SPP cap be lifted. No reply as yet. They have been calling shareholders which is a good sign for their appetite to expand the SPP.

June 2

National Storage (NSR)

$300 million placement at $1.57, a 7.1% discount to last trade of $1.69, using the extra placement capacity rule to expand its issued capital by an excessive 24.1%. Was followed by an under-sized $30m SPP equivalent to just 9.1% of the $330 million with no VWAP pricing alternative. The 6,300 retail shareholders could apply for $189 million in stock. Predator Abacus has just under 5% and was deliberately diluted. Joint under-writer JP Morgan also agreed to provide an additional $100m debt facility, something we haven't seen negotiated with many other equity under-writers. The special placement allocations announcement didn't reveal anything meaningful about what proportion of the placement went to new shareholders.

June 2

Australian Finance Group (AFG)

$60 million raising comprising a $15 million placement at a 17.3% discount of $1.15 followed by a non-renounceable 1-for-5.5 at $1.15 with certain insiders partially under-writing the retail offer. Retail can apply for unlimited overs which is a good thing.

May 29

Ingenia (INA)

$150 million placement at $3.45 followed by a $25 million SPP at the same price or a 2% discount to the 5 day VWAP leading up to the May 29 close. This only proposes giving retail 14.3% of the $175 million capital raising when a $109.8 million entitlement offer last year suggested retail owned 16.7% of the register at the time. However, this would have been diluted by the accompanying $21.3m placement at the time, plus the fact that the $18.4 million retail component finish 26% short after applications for additional shares were limited to 15% of an entitlement. Only has about 3500 holders so the theoretical maximum for the SPP is $105 million.

May 29

Dicker Data (DDR)

$50m placement at $6.70, a 6.7% discount to the last trade of $7.18. Placement only comprises 4.6% of issued capital and to be followed by a $5m SPP at the placement price of a 2% discount to VWAP closing on May 29. With 7000 retail shareholders, the theoretical maximum in SPP applications is $210 million. Wrote to them on May 7 requesting some transparency measures and that the $5m SPP cap be lifted. No reply as yet.

May 27

Newcrest Mining (NCM)

$1 billion placement at $26.50 followed by a $100m SPP at the same price or a 2% discount to VWAP. With 54,000 retail holders, the theoretical maximum is $1.62 billion so significant scale back risk with retail only allocated 9.1% of the raising. Wrote to them on May 12 requesting a range of transparency and disclosure measures, including an increase in the $100 million cap, particularly given Newcrest restricted retail investors to just $5000 each during its last SPP in 2009 when the maximum was $15,000.

May 26

Lend Lease (LLC)

$950 million placement at $9.80 followed by a $200m SPP at $9.80 or a 2% discount to VWAP (last 5 day and last day). Placement is equivalent to 17.2% of capital so ASIC and ASX will have to be provided the allocation spreadsheet. Closes Tuesday May 26 and allotted 7 business days later on Thursday June 4. Wrote to them on April 28 requesting a range of transparency measures and a bit disappointed with the lack of detail in this placement conclusion announcement suggesting some stock was issued to non-shareholders, in contrast to what NAB did.

May 26

Charter Hall Social Infrastructure (CQE)

$100m placement comprising 15% of issued capital at $2.20, a 7.6% discount to the last close of $2.38, followed by a $15m SPP at $2.20 or a 2% discount to VWAP on either the closing date or the last 5 days, which ever is lower. Requested an increase in the SPP cap but also thanked them for adopted VWAP pricing after sister REIT Charter Hall Retail didn't offer this the previous week. Has some history with lifting capped SPPs, after it set a $5m cap on an offer earlier in 2020 but then received $19.3m in applications, which were all commendably accepted.

May 22


$3 billion fixed price placement at $14.15 followed by $500m SPP at the same price or a 2% discount to VWAP. Closes on Friday May 22 and allotted 7 business days later on June 2. A fail due to the excessively capped SPP although the board could always choose to lift the cap. The 500,000-plus retail shareholders owned 48% of the bank before the placement and if they all apply, more than $15 billion will come through the door even though retail are only being allocated 14.3% of the raising. Wrote to the board on April 27 requesting an increase in the SPP cap and good detail in this placement conclusion announcement which commendably disclosed that no shares were allocated to non-shareholders. NAB has a history of SPP scalebacks, particularly in 2009 when it maintained a $350 million cap despite receiving $1.75 billion in applications. Will be under considerable pressure to lift the $500m cap given this history.

May 21

Infomedia (IFM)

$70 million placement at $1.50 followed by a $30,000 SPP for retail investors capped at $15 million and with alternative pricing based on a 2% discount to VWAP. Wrote to the company and received a considered reply including disclosure that 2% of the placement went to non-shareholders and retail owed 35% of the company before the placement was launched, suggesting an increase in the cap might be in order given that it only envisages retail receiving 17.6% of the $85 million capital raising. Was only marginally in the money so demand of $13.9 million was less than the cap so no scale back. Excellent participation data. See outcome announcement.

May 21

Charter Hall Retail (CQR)

$275 million placement at $2.90 followed by a $25m SPP at the same price with no VWAP alternative. Closed May 21 and allotted May 28. Engaged over the lack of a VWAP alternative but management declined to make any changes. In the end they lifted the cap and accepted at $29.4 million in applications. See outcome announcement. Declined to provide precise data on participation rates. 5/10

May 21

Qube (QUB)

1-for-6.35 non-renounceable entitlement offer at $1.95 with retail investors invited to apply for additional shares equivalent to 100% of entitlement. Canada's CPP declined to participate in the $264 million accelerated institutional offer but there was 99.3% demand for the balance and "overwhelming demand" for the shortfall. No disclosure as to how the shortfall and CPP's entitlement was allocated in this ASX announcement. The $236 million retail offer to the 27,000 holders closes on May 21 and is allotted on May 28. The average retail offer will be for $8740 worth of new shares with applicants able to apply for double this under the "overs" component which will hopefully ensure it doesn't short. The stock soared to $2.56 after the suspension was lifted so being 31% in the money, let's hope the board runs a strong marketing campaign to maximise participation. Wrote to the company on May 5 and received a considered reply from the CFO pointing out that there hadn't been a shortfall in two previous entitlement offers which had an overs limit of 100% of entitlement.

May 20

Ramsay Healthcare (RHC)

Launched a $1.2 billion institutional placement on April 22 at a 12.9% discount of $56, under-written by JP Morgan. A $200 million SPP will follow at the same price or a 2% discount to VWAP over the last 5 days of the offer. Ramsay has 80,273 shareholders so the theoretical maximum application for the SPP is worth $2.4 billion and they ended up receiving $695 million after 41,877 shareholders applied for an average amount of $16,596. The $200 million was lifted to $300 million, meaning $395 million was still refunded based on size of holding but with a minimum allocation of $560. Had a number of exchanges with the company and the outcome was reasonable, including excellent transparency on participation rates in the outcome announcement. 6/10

May 20

Monash IVF (MVF)

Unveiled an emergency $80m capital raising at 52c, a hefty 26.8% discount to the previous trade of 71c. Comprised a $39.8m placement and a $40.2m 1-for-3 entitlement offer with retail able to apply for overs of 100% of entitlement. Closed May 20. Good disclosure in the outcome announcement which showed a 43% take up of the $15 million retail offer comprising $5.3 million in entitlements and $1.2 million in overs which would have been higher if not limited to 100% of entitlement.

May 15

Centuria Industrial (CIP): Unveiled a $130m placement at a floor price of $2.54 (an 8% discount) on April 9 2020 but at least the final price was set by a bookbuild and came in at $2.62. A $10 million SPP followed capped at $30,000 per investor, even though the company did an earlier UPP within the past 12 months. There is no VWAP pricing alternative and the raising is under-written by Moelis and JP Morgan. REITs value their assets every six months and really shouldn't be raising capital at a discount to NTA but that is what Centuria did given the NTA was $2.83 as at December 31. This outfit also called an EGM in February 2020 to approve an earlier $154m placement at $3.41 in December 2019 to help fund the purchase of some Arnotts properties. This was not followed by an SPP. Naughty. The latest SPP ended up raising $8.3 million at $2.62 so there was scaleback as this was below the $10m cap. See announcement. 6/10

May 15

Bapcor (BAP)

Completed $180m institutional placement at a fixed price of $4.40 and will follow with a $30m SPP which has three pricing options: placement price, 5-day VWAP and last day VWAP. With around 16,000 retail holders, the maximum application is around $480 million. Retail have only been allocated 14.3% of the proposed $210 million capital raising when retail had 30.7% or $67 million of the renounceable $218 million entitlement offer back in 2015. Strong grounds to lift the cap, which they duly did, accepting $56 million of the $122 million in total applications and using a scale back formula giving all applicants a minimum of $1000 worth of shares and 50% of their current holding after that. See announcement. 6/10

May 15

Metcash (MTS)

$300 million placement at fixed price of $2.80 under-written by Macquarie followed by a $30m SPP at $2.80 or a 2.5% discount to the 5-day VWAP. Claimed that 95% of the placement went to existing shareholders although no idea how strict the pro-rata allocation policy was. Stock traded at a discount throughout the offer period and ended up being priced at $2.28, an 18.2% discount to the placement price. Only 6.3% of holders or 1214 contributed $13.6 million to the SPP which ended up comprising just 4.3% of the overall $313m capital raising. See SPP outcome announcement which had excellent transparency. 6/10.

May 13

Invocare (IVC): A $150 million placement at $10.40 followed by a $30,000 SPP capped at $50 million. The SPP has an innovative 3rd pricing alternative of VWAP -2% on the closing date, as well as the placement price and a 2% discount to the 5 day VWAP. The stock was trading below the placement price in late April so the VWAP pricing alternatives is likely to come into play. With 24,000 retail holders the theoretical maximum is $720 million. Ended up accepting all $74 million in applications at the placement price of $10.40, even though this exceeded the $50 million cap and the offer was barely in the money.

May 13

Capitol Health (CAJ):

Announced a $40 million capital raising at 16c comprising a $30 million placement and a $10 million SPP. Failed to disclose what proportion of the placement went to existing holders. Was priced at an 18% discount to the previous close of 19.5c and has remained in the money ever since. Fully under-written by Shaw Stockbroking. Minimum investment of $2500 in the SPP outlined in the offer document and no VWAP pricing alternative. The SPP outcome announcement was a little hard to understand with no disclosure of the overall amount applied for. The cap wasn't lifted and all applicants ended up with a maximum allocation of around $16,300. Refunds were initially delayed until June 5 but then this was brought forward to May 25. 5/10

May 12

Mesoblast (MSB)

Completed a $138 million placement at $3.20 a share, a 7% discount, on May 13 but no sign of any follow-on SPP. Very disappointing as this is the largest stand alone placement we have seen this year where retail shareholder have been completely excluded. The company's 13,000 retail shareholders were also excluded from a $75 million placement in 2019 so it has form when it comes to diluting retail shareholders.

May 11

QBE Insurance (QBE): Announced a $US750 million placement at the fixed price of $8.25 to be followed by a $US75 million SPP. The insurance giant has a history of scaling back and shafting retail investors in SPPs so it will be interesting to see if the SPP cap is hard or soft. The placement was priced at a 9.4% discount to the previous close of $9.11. The placement was under water with QBE shares trading below $8 in early May so the alternative pricing of a 2% discount to VWAP has come into play. Wrote to the company on April 29 requesting a range of transparency measures but they declined to provide an update on applications to the ASX, or to inform investors about the VWAP pricing on the last day.

May 8

SCA Property (SCP)

$250 million placement at $2.16 after a bookbuild with a $50m SPP to follow at $2.16 with no VWAP alternative. Receives a 6/10 because of the bookbuild which limited the discount and proved to be well priced in the aftermarket with the stock only trading around the placement price. Wrote to the CEO and CFO on May 7 and pleased with the detail in this SPP outcome announcement disclosing that the offer went to 60,000 holders and 3.9% or 2350 applied for $29.3 million worth of stock. 5/10 given lack of VWAP pricing for retail.

May 8

Electro Optic Systems (EOS)

Completed a $134 million placement at $4.75 managed by Citi followed by $10 million SPP closing on May 8 and allotted on May 14. With 8,357 shareholders, allocating just 7.46% of the capital raising to retail investors seems pretty skinny but the cap was ignored in the end. There was a VWAP pricing alternative but no discount besides being rounded down to the nearest cent. Good disclosure at the end with the offer sent to 8,357 holders and attracting $10.78 million from 740 applicants who paid the VWAP price of $4.40, a 35c discount to the placement price. 6/10 given VWAP pricing, lifting of the cap and good participation transparency.

May 4

IDP Education (IEL): announced a $175m placement at $10.65 and then lifted this to $225 million, whilst retaining the cap on its subsequent SPP at just $15 million. Macquarie collected a $5 million fee based on a 2.2% commission. The discount on the day was 7.9% against the previous closing price of $11.56 and the expanded placement equated to 8.3% of the shares on issue. The $30,000 SPP closes on May 4 and was well in the money throughout the offer period so demand should be strong. The higher education provider floated off by Seek a few years back defends the $15m SPP cap on the basis that retail shareholders only own about 4.8% of the stock, yet are getting 6.25% of the raising. Fair point, although it really should be measured on the free float, given that Universities Australia owned 49% before the raising was launched but is now down to around 46%. With only about 3000 eligible shareholders, there is a chance the board will expand the $15 million cap to accept all applications as the maximum amount possible is only around $90 million. Good disclosure in the outcome announcement revealing the offer was sent to 2949 shareholders and 1292 applied for $34.5m in stock with a scale back to $29 million based on the size of holding although every shareholder received a minimum of 235 shares. The participation rate was 44% and average application was $26,702. The placement came with an expanded bank facility and deferral of the $41 million interim dividend, so there was some genuine financial waves to contend with. 6/10

May 4

Megaport (MP1)

Unveiled a $50m placement on April 8 2020 at $9.50, an 8.9% discount to the previous close of $10.43. A $30,000 SPP at $9.50 will follow, capped at $15 million. The company has a history of scaling back SPPs and doing placements without SPPs. In December 2019 it did a $62m placement at $8.70 (a 4.8% discount) with no SPP and on March 14 2019 it did a $50m placement at $4 a share but then limited the SPP to $10m and $15,000 a pop. It was heavily scaled back after $47.6m in applications were received. The placement capacity was refreshed at the 2019 AGM. Wrote to the company lobbying for the cap to be lifted and after $99 million poured in, the $15 million cap was expanded by 50% to $22.5 million, meaning $76.5 million was still refunded. See SPP outcome announcement. 5/10

May 1

Flight Centre (FLT): The $700 million Flight Centre capital raising included a $282 million placement at $7.20 which diluted retail shareholders and a $418 million 1-for-1.72 non-renounceable entitlement offer at the same price, which was a 27.3% discount to the last traded price of $9.91. The three founders – CEO Graham Turner, Geoff Harris and Bill James – went into this crisis owning a combined 42% of the company and collectively committed $25 million of their $175 million entitlement, diluting themselves into the raising. The total number of shares on issue almost doubled. There is also an ability for retail investors to apply for overs equivalent to 25% of their entitlement, which is way too restrictive from a small shareholder perspective. The founders went in through the institutional offer which was 96% subscribed by eligible instos. They should have gone in through the retail offer and also tucked into the 25% "overs". The $138 million retail offer finished 23% short, attractive $106 million from 13,116 applicants (there were about 22,000 shareholders listed in last year's annual report), including $14 million through the needlessly constrained overs facility which was capped at just 25% of entitlement. The under-writers Macquarie and UBS were on a winner with the stock trading around $10, well clear of the $7.20 offer price. 4/10

May 1

G8 Education (GEM) On the day last trading day before Easter, G8 Education came up with a $301 million capital raising comprising a $134 million placement and a $167 million 1-for-2.2 entitlement offer which comprised $89 million from institutions and $79 million for retail. So, this was a retail heavy register that started with retail owning 47.3% of the company and will finish with 30-something depending on the size of the retail shortfall. The placement was a tolerable 44.5% of the raising which wasn't as bad as Oil Search but still on the high side. As usual, there was no renounceability and the discount was a hefty 26% with the offer at 80c against a last trade of $1.08. The institutional component of the retail offer was 99.7% subscribed. The retail overs were limited to just 25% of the entitlement and with the stock trading around the 80c issue price, it finished $50 million short, attracting just $25 million from 4198 applicants. There were about 22,000 shareholders listed in the last annual report. At least the retail offer was barely in the money, meaning that the placement wasn't given away too cheaply. The under-writers RBC and UBS were left with a chunk of stock which would have been farmed out to sub-under-writers when the deal was first launched. 4/10

May 1

Dacian Gold: (DCN) There's been a good deal of shareholder anger about the $98 million capital raising because the stock last traded at $1.40 on January 31 before it was suspended. The $98 million raising is priced at 30c and comprises a $30 million placement and a $68 million entitlement offer, $28 million of which is for retail and has unlimited "overs". The stock was trading at around 37c with a week to go. Wrote to the company about its scale back options if it was over-subscribed. Retail offer ended up being 74% subscribed, even with unlimited overs, so the $7.3 million shortfall went to the under-writers. Despite a request, no disclosure on how many shareholders applied or the breakdown between entitlements and "overs". 6/10 due to unlimited overs.

April 30

NextDC (NXT) did a $672 million placement at $7.80 which represents 25% of shares on issue making use of emergency relief even though stated reason was “to pursue growth initiatives”. The $15m in transaction fees (2.2% of total proceeds) seemed excessive given the under-writers were on risk for just 24 hours and the offer was pitched at a 15% discount to the previous close. The changes to the capital raising rules were meant to help distressed companies so what on earth was booming data centres company Next DC doing unveiling a $672 million placement when it hasn't been hit by the Covid-19 crisis at all? The best thing about the Next DC raising is that the follow-on SPP is uncapped. Next DC has about 16,500 retail shareholders so the maximum theoretical participation is around $500 million and with two days to go the company advised that $86m had already come through the door. There is talk of anger amongst Next DC's institutional shareholders, some of whom weren't accommodated. That's the problem with placements. It's a secretive share allocation process. If giving away part of the company to non-shareholders, at least there should be some disclosure as to who took the shares. The SPP closed on April 30 and attracted $190 million in applications with no scale back. The participation rate was an impressive 51% as the company embraced best practice disclosure by revealing 8,684 of the 17,015 eligible shareholders applied. 6/10

April 27

Oil Search (OSH): One of the key measures for fairness in capital raisings is the size of the placement compared with the size of the entitlement offer. Ideally, there would be no placement at all, but if there has to be one, it should comprise no more than one third of the offer. Oil Search has been one of the worst offenders on this front when it launched a $760 million placement which was almost double the size of the 1-for-8 entitlement that raised an additional $400 million. A 1-for-8 is nothing. It clearly should have been the other way around with the a placement of no more than $400 million and an entitlement offer raising double that amount. It is just appalling that in a $1.16 billion offer, retail investors are being offered only 6.9% of the raising ($80 million out of $1.16 billion) when we started out owning 20% of the company. The placement of 362 million new shares at a 23% discount of $2.10 also represented 23.74% of the pre-issue capital so it would have been illegal earlier this year. All up, this is shocker, with the only minor saving grace being that retail shareholders are being offered "overs" which are capped at 200% of their entitlement. The company agreed to a request to publish this progress announcement to the ASX revealing that the offer was 20% subscribed with a week to go. The institutional component of the $320 million entitlement offer was 95% subscribed excluding largest shareholder Mubudala (Abu Dhabi sovereign fund) which didn't participate. Despite being heavily in the money, the retail offer fell $0.5 million short with applications for entitlements totalling $39.4 million and "overs" coming in at $40.1 million. This is a clear lesson about the need for unlimited "overs" when an offer is non-renounceable. See announcement. 3/10

April 27

Southern Cross Media (SXL): $169m raising at 9c comprising a $47 million placement and a $121 million entitlement offer. The placement comprised a ridiculous 68% of the pre-raising shares (522 million shares at 9c against 768.7m before the raising was launched). Stock had doubled to 18c by April 15 so massive dilution for retail shareholders. Non participants receive no compensation. Institutions took up 92% of their entitlements to the $102 million entitlement offer leaving an $8.16 million shortfall with the unknown sub-under-writers. The $20 million retail offer will no doubt finish well short given the lack of overs. Have asked them to crank up a solid marketing campaign and was delighted when they released this announcement to the ASX revealing the offer had been 18.6% subscribed with a week to go. The final announcementrevealed 66% of the shares were taken up but gave nothing on the numbers who participated. The $6.8 million shortfall went to the under-writers and with the 9c shares trading at 12-13, it was money for jam for them. 2/10 given huge discount and lack of any overs.

April 24

Reece (REH): The plumbing supplies giant has shown how to do it, becoming the first issuer to ever follow an institutional placement with an entitlement offer that was also twinned with an SPP for retail. The detail is all spelt out here but this is very bold for a capital raising because it sets the precedent which says: “any company which does an institutional placement should also do an SPP on the same terms, regardless of whether there is an entitlement offer thrown into the mix as well.” Normally, after a placement, retail will get a token SPP or there will be an entitlement offer if the situation is more pressing, just like occurred so many times during the GFC. But we never get both. Asciano is the only issuer I can think of that did a make-good SPP after a placement/entitlement combo but it wasn't at the time same. Here is the 2009 SPP outcome announcement explaining how the Asciano offer was scaled back from $290 million to $100 million but retail shareholders had still successfully topped up after the earlier dilutive placement and entitlement offer. Tellingly, then Asciano chairman Tim Poole is now deputy chair of Reece. The $600 million Reece package involved a $368 million placement at the fixed price of $7.60, which was a 12.5% discount to the last closing price of $8.69. There was also a 3-for-55 non-renounceable entitlement offer at the same price to raise $232 million and the $42 million institutional component was more than 99% subscribed. The three Wilson brothers are collectively in for their full $170 million slice of that, coming in through the $190 million retail offer. The Wilson's will be scaled back from 73% to 67% by the placement and a little further by the SPP, depending on the take up. The 4894 eligible Reece retail shareholders had a theoretical maximum take-up of $147 million in the SPP which wasn't capped. In the end, 1991 of them applied for $47 million worth of SPP shares with an average application of $23,600 and a healthy take up rate of 40.6%. The $20 million retail entitlement offer (ex Wilsons) also had unlimited overs and the scale back formula saw all applicants receive a minimum of $15,000 worth of share, although it was not disclosed how many shareholders participated in the entitlement offer, which finished 64% subscribed as $12.8 million came through the door, along with an extra $10 million in applications for additional shares. See outcome announcement. 7/10

April 24

Auckland Airport: the first issuer to embrace price discovery when it launched a $NZ1 billion placement, under-written at the floor price of $NZ4.50 but where the final price was set by a competitive book build which came in at $NZ4.66, the top of a 16c indicative range given to bidders. A $NZ50,000 SPP for retail followed to raise up to $NZ200 million. Wrote to the company requesting that the $NZ200m cap be lifted if demand is strong. Was well in the money at the close and they imposed a heavy scale back after receiving $NZ489 million in applications from 32,619 holders. The average application was only $NZ15,000 and the scale back was based on size of holding. See announcement.

April 28

Salt Lake Potash (SO4):
Completed a $20 million placement at 34c on April 28 but declined to even offer retail shareholders an SPP. Shameful. 1/10.

April 28

De Grey Mining (DEG): $31.2 million placement at 28c on April 28 and no sign of any follow-up SPP. Shameful. 1/10.

April 23

Cochlear (COH): an $880 million placement at $140, followed by a $50 million SPP which is patently too small. Failings were not having a bookbuild to set the placement price, unfairly limiting the SPP and allocating too many shares to a single London-based fund manager, Veritas Asset Management, which picked up an astonishing 34% of the $880 million Cochlear placement. We only know this because Veritas launched a buying splurge shortly before and after the placement to finish up with a 5.57% stake which was above the 5% substantial shareholder rule in Australia and was therefore disclosed to the ASX on April 2. It really is offensive that 36,724 retail shareholders were proposed to be limited to $50 million, when one London fund manager was given more than 6 times that amount of shares in a discounted placement. In the end, Cochlear received $417 million in applications from 16,651 shareholders, a 45% participation rate. The board lifted the SPP cap to $220 million but still refunded $197 million, the bulk of which went to smaller shareholders because the allocation formula favoured bigger holders. All is explained in this 3 page ASX announcement from Cochlear at the end of the offer, which did well on the transparency front. Retail finished up receiving 20% of a $1.1 billion capital raising which the board claimed doesn't material change the pre-raising allocations. I suspect retail had a touch more than 20% before the placement launch and it remains remarkable that board seriously thought it could limit retail to just $50m. Do the maths. If all 36,724 holders had applied for the maximum $30,000 new shares in the SPP, that would have brought in $1.1 billion. The majority of Cochlear's shareholders, 20,073 in fact, didn't bother applying at all and they are the biggest losers in Australia's capital raising system. Only a renounceable offer would fairly compensate these investors, many of whom are never even told about the offer by their financial adviser or fund. 5/10

April 21

Webjet (WEB): raised $346 million broken down into 3 components, $115 million in a placement at $1.70, $116 million from the accelerated institutional entitlement offer at $1.70 and $115m from the 1-for-1 non-renounceable retail offer. Foreign private equity firm Bain took $25m through the placement. Non-participants in the retail offer got nothing but participants could apply for overs equivalent to 100% of their entitlement. The institutional component was 90% subscribed leaving an $11.6 million shortfall which went to unknown parties at no premium. The discounted pricing was the most offensive element because the stock last traded at $3.76 before it was suspended and when it resumed trading it finished the week on April 3 at $2.73, a massive 60% premium to the $1.70 placement price. It used the supersized waiver alongside the new emergency relief to arrive at the placement component of the raising representing 50% (after upsizing the placement and underwritten entitlement offer following strong demand) of shares on issue when the raising was announced. The retail offer closed on April 21 and Webjet attracted strong support with applications worth $86m, plus a further $46.7 million in overs. This led to a $14.5m scale back where investors were cut from 100% overs to 69%. The outcome announcement also included excellent data on participation rates. Unlike with Kathmandu, this strongly in-the-money offer was well supported but there was still 11,427 shareholders who declined an offer to buy new shares at $1.70 when the stock was trading well north of $2. 4/10

April 17

Kathmandu (MKD): Sometimes existing shareholders just don't have the capacity to participate in a rushed capital raising during a crisis and that can see them massively diluted. That's exactly what happened to New Zealand entrepreneur Rod Duke whose Briscoe business used to be the largest shareholder in retailer Kathmandu with a 16.3% stake. However, with the broader retail sector in crisis, he couldn't afford to participate and was subsequently diluted down to just 6.77% without any compensation. Kathmandu is suffering indigestion after paying $350 million in cash for Rip Curl in November last year and has now embarked on an emergency $NZ207 million capital raising comprising a $NZ30 million placement and a $1NZ177m 1.2-for-1 entitlement offer at NZ50c. However, because the offer wasn't renounceable, when Briscoe rejected the offer, its shares were just given away to new investors at NZ50c. Leaving aside the Briscoe shares, institutions took up 96% of their entitlements. The $NZ53 million retail component offered unlimited "overs" but only attracted $NZ26.5m in applications along with $NZ17 million in overs to finish 18% short as investors declined to take up $NZ9.5 million worth of stock which was comfortably in the money. This was another windfall for the under-writers with the stock at around A70c shortly after the retail shares were allotted on April 22. No disclosure on how many shareholders participated. 5/10.

April 16

Oohmedia (OML): One of the oldest tricks in the book is for big corporate, institutional or insider shareholders to creep up a share register by under-writing the retail component of a non-renounceable entitlement offer. That is what we've got with the emergency $167 million raising from debt-laden outdoor advertising company oOH!media, which comprised a $39 million placement at 53c, plus a 1-for-1 entitlement offer for existing shareholders at the same price with no overs. The stock had last traded at 84c before the offer was launched. The ability to apply for extra shares was presumably banned because major shareholder HMI, a US-based investment fund, had aspirations to lift its stake from 18% to 25% and intended to average down its entry price through both the placement and the retail shortfall. Boards should never prioritise under-writers over retail shareholders when it comes to dealing with the retail shortfall. This company made used of the supersized waiver to allow it to make a placement of 30% on the basis that it was also conducted a one-for-one entitlement offer. The accelerated component of the institutional entitlement offer was supported by 91% of institutional shares and raised $117 million. The shortfall was allocated to unknown parties at no premium. The retail component was only worth $14 million and was not renounceable with no overs. All 3400 retail shareholders should have taken up their entitlement but it finished 27% short with $4 million worth of stock going to the under-writers. No disclosure of how many shareholders participated. 2/10.

April 15

Carbon Revolution (CBR): Was first out of the blocks with a $25 million placement at $1.50 that completed on March 18. Followed up with a $3m SPP closing April 15 which attracted $2.73 million in applications from 252 shareholders with an average application of $10,833. Only 8.25% of the 3053 shareholders participated because it was out of the money for part of the offer period and they failed to offer a VWAP pricing alternative. Wrote to them asking for extra transparency on the retail participation rates and was very pleased when they delivered and joined our best practice list. 7/10.

April 3

Red 5 Mining (RED)

The Perth-based gold miner did a $125 million placement at 18c with no SPP for retail shareholders. This comprised 55.8% of pre-raising capital and therefore needed shareholder approval. Was priced at a 23.4% discount to the last price and the stock was at 21c in mid May so the existing 4800 retail shareholders have been diluted without compensation.