DFS -issuing shares

Sally

This may be a daft question but... when preparing the report in Section 2 .. is it ever an option to recommend issuing shares to raise cash. I've always puzzled over this. They never seem to mention authorised share capital which i believe is the amount of shares that could be issued in total so i wouldnt know if this had been exceeded. Basically, i'm just trying to amass a stock of possible recommendations and do not know if this is applicable. Any ideas???

jilt

Well yeah a company can isue shares to raise cash however my initial thought was they usually ask you to prepare a report for an investor and would an investor be happy about issueing more shares as this may lead to a drop in the earnings per share ratio, there would be shareholders to share in the profits.

Maybe if the capital being raised was to invest in new PPE in order to improve efficiency and therefore profits then that would be acceptable, but maybe I'm talking rubbish lol

Sorry I'm not much help

DaveIOW

If it was an issue of shares to current holders only...rights issue I think, it is a cheap & easy way to raise cash by offering extra shares at below market value & it keeps the exisisting base of shareholders