Private placements always get investors juices going and blood pressure soaring. For one thing, there's never enough information.
For example, if BHP Billiton was SPQ's suitor and bought $1,955,110.15 worth of shares, someone would probably crucify NN for not telling everyone what the CEO was eating for breakfast that day!
Here's some stuff we can deduce from the private placement:
1) $4.75 million CDN worth of common shares are available on a best efforts basis brokered by IBK Capital Corp.
2) this translates in to 78,750,000 shares
3) add this number of PP shares to the outstanding number at the time of the PP (316,211,767) and we get 394,971,767 shares (if the PP is fully subscibed)
4) We can infer - since we don't know the "major" behind this private placement - that the "major" has less than 10% of the 394,971,767 (assuming once again that the PP will be fully subscribed).
5) So 9.9% of the total number (fully subscribed) is 39,102,204 shares, and they would be purchased from the 78,750,000.
6) Now I'm unclear as to the cost per share of this PP, but I'm going to throw out a figure of 5 cents. If it was 5 cents, then the "major" has spent $1,955,110.15 for 39,102,203 shares.
If I remember correctly, the number of shares voted against the "reverse split" resolution was over 33 million shares. Interesting factoid.
So my question is - Why the fear?
One final thought. Neil Novak and his Board of Directors of Spider Resources has raised (potentially) $4.75 million in an economic environment which, quite frankly, sucks. I can't confirm this but I believe this PP dollar amount is the largest private placement on record for SPQ.
So my last questions are: What company would invest in Spider Resources at this time? and Why would they do it now?
Of all companies on the ROF including Freewest Resources (who I really like), Why Spider Resources? Something has to be cooking. IMHO
Just some thoughts. Comments, as usual, welcome.
Snug
