Placements are the most common way for smaller companies to raise fresh capital @lowway and that's because it's a LOT cheaper than doing a rights issue or a SPP for all current shareholders. Because the placements are to insto's and/or sophisticated investors, the disclosure required by the company in terms of identifying risks and so forth is much lower, which is one obvious cost saving, there's also no need to post out stuff to all of your shareholders, so, again lower cost, and finally it's way quicker to do a placement, being anywhere from 1 to a few days usually, vs over a month usually when doing a Share Purchase Plan (SPP) or Rights Issue (RI). So quicker and cheaper, which matters to smaller companies in particular, because they don't want to spend money if they don't need to, and they want their cash ASAP and get back to trading on the ASX, rather than have an active SPP or rights issue for weeks which may drag down their share price further.

There's also less churn, as retail investors will sometimes sell shares on-market to fund their SPP or rights issue purchases of shares in the same company, if they can sell the shares for more than the new shares are being offered at. This is not such a problem with a share placement where it is far more common for some churn to take place after the shares are issued. The churn adds to share price volatility, which is not a good thing for a company when they have an active SPP or RI and retail investors are watching daily share price movements to try to work out whether to participate in the RI or SPP or to pass on it and possibly buy shares on-market at lower prices instead.

Another cost saving is underwriting costs, which can be considerable, and small placements are usually not underwritten, whereas SPPs often are.

In short, while placements provide unfair advantages to larger players at the expense of smaller retail investors, the cost and time benefits of placements tend to make placements the go-to option much of the time for smaller companies in particular, especially pre-revenue companies in the mining sector.

Yep, I get (and already knew) everything you're saying @Bear77 and have known that is the industry standard for small caps in particular. Still doesn't make it right or fair IMO, especially as it's my holding that is being diluted without any option to be a part of that discount to market price for those special few.

Naturally I don't expect it to change as even the big boys (large caps) have been doing it for years and only in recent times been made to offer some opportunity to shareholders to participate in the same capital raisings that are done at discounted prices off-market.

Only upside is the shares are reasonably tightly held at $VTM and therefore there is still appetite in the market to get on board, which means the share price went up today. A nice 20% one day rise for "Special" Investors in the capital raise and a 5% gain for the rest of us plebs!!

Yes @lowway it's certainly not a level playing field, that's for sure. I used to get grumpy about it but now I just try to learn the rules, and how it all tends to work, and try to make some money within that framework as best I can. Accepting that which we can not change. Has helped reduce my blood pressure anyway.