Social media company migme has cancelled plans to undertake a share placement, after being battered by volatile markets and selling by long-term shareholders who had acquired the stock when it was a mining business.
The company planned a placement after chief executive Steven Goh gave presentations to institutions in Europe and Asia, and received expressions of demand for migme stock.
However, in a statement today, the company said the decision to cancel the placement was made as a result of the volatility in world markets, coupled with migme’s falling share price during the past two weeks.
“It is no longer possible to complete the proposed placement at the quantum and price premium as originally intended by the company,” migme said.
The company said it held $5.9 million cash on hand and its monthly active users had grown to more than 10 million.
“The board will continue to assess strategic funding options as they arise. However, the company has no immediate need to raise additional capital,” migme said.
Mr Goh said that, during the time the company was planning on undertaking the placement, he saw that “a substantial number of shareholders (who had their key holdings between 2010 and 2012) from our prior entity (Latin Gold) had started taking profits in January”.
He said that is what led to selling outweighing buying in the market.
migme shares came out of a trading halt 5.79 per cent lower to 65 cents per share by 12pm.
migme undertook a backdoor listing last year through Latin Gold in June, in a deal worth about $19 million.
