ARI (Arrium) : At Rock bottom, ore not?

[Dej]

Insiders are buying. From the AFR dated 23rd September:

"Arrium directors Peter Nankervis and Graham Smorgon have joined their incoming chairman Jerry Maycock in snapping up Arrium stock after a mass selloff sparked by the steel and mining group’s $754 million equity raising."

SNOOPY

Sometimes directors buying doesn't mean much in my mind. They could be doing it specifically because of what you are saying, to stir investor confidence in a time of weakness. The real interesting point is if the EMPLOYEES that we don't have data from are buying at these levels as well, thats a true indicator (to me - really hard to find of course)

What are the thoughts about this drifting south until the raise is completed and on market? Could be a series of opportunities to buy over the coming month (think its mid October its completed)

[Snoopy]

What are the thoughts about this drifting south until the raise is completed and on market? Could be a series of opportunities to buy over the coming month (think its mid October its completed)

Retail rights trading ceased 30th September. Subscription payments have to be in by this Friday (3rd October). New shares will be allocated by 8th October. After that the shortfall in rights will have to be dealt with by the underwriter. So your mid-October estimate to have everything dusted is probably not far from the mark Dej.

I have been around the market a few years now, but I have never seen anything like this. By 'this', I mean an established company with a fully underwritten share issue so scorned by its shareholder base that even professional investors do not want a bar of its heavily discounted rights issue.

Yes I understand the problems with the collapse of the iron ore price. But the amount of recapitalisation required to ameliorate this would have been discussed with ARI's banking syndicate. So there is no immediate risk of company failure. Yet the shares are being sold down on market as though ARI is a dead duck. I don't particularly like ARI (only came onto the register when it was spun out by BHP). But there comes a point when the share price gets so ridiculously cheap the investment case becomes compelling. That is why I greatly upped my stake to what is still in my terms a modest holding two days ago.

I saw a report that said the underwriter would want out of the shares they will get quickly and as a result ARI has been subject to some short selling. Can anyone shed some light on the short sold position of ARI? If it does go lower, I may have to pick up a few more!

SNOOPY