Junior Australian/US biotechnology company Novegen Limited (ASX: NRT) has taken its shareholders on a rollercoaster ride, rising a meteoric 221% in just two days before plummeting back down to earth in late afternoon trading.
The shares traded for just 8.4 cents on Monday and then rose 96% on Tuesday after it announced a breakthrough in the treatment of melanoma. The shares lifted a further 63.6% on Wednesday morning to a 27 cent high, but have since plummeted back to just 11 cents.
Shareholders may want to look away now:
Source: Google Finance
The reason for the heavy retreat was the announcement of a capital raising which will see $4.1 million raised in the form of a private placement. The 32.85 million ordinary shares will be sold at a price of 12.5 cents, with an option to purchase an additional 32.85 million ordinary shares at 15 cents, which is exercisable over the next five years.
Needless to say, this is hardly the way shareholders were expecting to celebrate Christmas.
