- Data protection software company Cipherpoint (CPT) has frozen its shares today ahead of a new capital raising plan — before its last one has even settled
- The company finished an oversubscribed share purchase plan earlier this week and has already revealed it plans to launch a new capital raise
- The company had to scale back applications in the recent purchase plan by roughly 60 per cent, meaning perhaps the new plan aims to capitalise on the keen investor interest
- Cipherpoint shares are in a trading halt until Tuesday, July 7
- Shares in the company last traded yesterday afternoon for 3.7 cents each
Data protection software company Cipherpoint (CPT) has frozen its shares today ahead of a new capital raising plan — before its last one has even settled.
The company requested a trading halt today as it gears up to launch the new capital raise, but no further details regarding what this might entail have been revealed yet.
Interestingly, Cipherpoint completed a share purchase plan earlier this week on Tuesday, June 30. The plan was heavily oversubscribed, with Cipherpoint seeking $500,000 but receiving subscriptions for over $1.25 million from shareholders. The company had to scale back applications by roughly 60 per cent.
Moreover, according to the company’s last quarterly report, Cipherpoint had only $920,000 cash in the bank at the end of March after spending $887,000 during the March quarter — meaning it had only enough money to operate for one more quarter at those spending levels.
As such, the oversubscriptions to the share purchase plan may form the basis for the new capital raise; with such strong support from shareholders for the purchase plan, Cipherpoint might be hoping investors are eager to pick up the extra shares they missed out on due to the scale-back.
Still, with shares from the purchase plan set to be allotted after the weekend, investors might be worried it’s a bit too early to be planning for further dilution.
Cipherpoint said the funds from the recent purchase plan will go towards general working capital and a bolstering of its balance sheet, but it’s not certain how the funds from the new capital raise are planned to be used.
The company’s share will be unfrozen on Tuesday, July 7, so shareholders have until then to speculate.
Cipherpoint shares last closed yesterday afternoon worth 3.7 cents each.