Petrolifera in ‘significantly dilutive' share issue

Petrolifera Petroleum Ltd. (PDP-T) announced what analysts this morning called a “dilutive but necessary” share issue, prompting UBS Securities Canada to cut its 12-month target on the stock. Petrolifera announced it would issue almost 20.6 million common shares under a bought deal at 85 cents a share that will raise $17.5-million. The underwriting syndicate also has the option for almost 3.1 million more. “This equity issue is significantly dilutive, potentially raising the company's basic share count by close to 20 per cent,” UBS said, cutting its one-year price target to $1 a share from $1.20.

“While we acknowledge the company's improved financial state with this equity raise, we believe Petrolifera's growth outlook remains unclear as we await results of the exploration activity in Colombia, and, more importantly, plans for the company's assets in Peru,” UBS said. http://www.theglobeandmail.com/report-on-business/can-the-stock-rally-continue-markets-abuzz-over-the-ipad/article1515685/

Best Wishes; Scott