AVOIDING A RIGHTS ISSUE
The Aveng update was a shocker. The balance sheet is under serious pressure as cash dropped and debt rose, but the critical line in the update was “actively pursue capital market funding alternatives, which do not currently include a rights issue”. In other words, the company needs cash, likely lots of it, and while a rights issue is not the current plan, it is certainly a good possibility. Remember, a rights issue is the last resort for raising more money, but if everything else fails then Aveng will have no other choice.