Gediminas Jasionis
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Ram Power Corp (TSE:RPG) (PINK:RAMPF) Discloses Pricing of Units Offering

by Gediminas Jasionis May 8, 2011
RPG_chart.pngRam Power Corp (TSE:RPG) (PINK:RAMPF) disclosed the pricing of a recent units offering as their share price continued to roll down with little retracements.

The gap down on Thursday sent the stock another 17.5% lower and it stayed down till the end of the week. The 3.85 million in volume, registered for two days in a row, was nearly 5 times the average of 770 thousand. Such an activity also showed the distribution of shares among shareholders as predictions of the downtrend bottoming out already have some merit.

Amid Friday's trading session the company announced that 127.2 million units will be offered at 55 cents per piece and will consist of one common share and one stock purchase warrant. Warrants can be converted at 72 cents per share. Ram Power also reminded they have applied to the Toronto Stock Exchange to list the warrants for trading.

ram_logo.jpgThe offering is expected to close this month. Proceeds are planned to be used to complete the construction of San Jacinto-Tizate project in Nicaragua and for general working capital purposes.

Originally announced on April 26, the offering created a massive selling pressure back then. The reaction can be explained when you calculate the dilutive effects of this equity sale. This offering holds a dilution potential of 161%, meaning there would be 2.6 times more shares outstanding if all the units are bought out and the warrants get converted.

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