Is this share dilution?

[Tyler Durden]

I've been following two companies (GDO and NRU) who have released announcements recently. As I understand it, a while ago NRU offered options to buy their shares to another company, and that company later exercised those options to purchase the shares at a much lower price than the current market price.

I would've thought that this would reduce the SP as it is shares dilution? But after it happened, the SP actually increased by half a cent, and hasn't really gone down below that.

 

[ParleVouFrancois]

Yes the share is being diluted, but it doesn't mean the price will be going down immediately. I own and follow GDO, someone exercised their options from what I can tell (director from memory), so there is more shares on issue, but not a significant amount.

PVF.

 

[Tyler Durden]

Yes the share is being diluted, but it doesn't mean the price will be going down immediately. I own and follow GDO, someone exercised their options from what I can tell (director from memory), so there is more shares on issue, but not a significant amount.

PVF.

Thanks PVF.
Is this type of thing usually seen as a good or bad thing by the market? I mean, I think in theory it's bad but in reality these are the first companies I've seen doing such a thing.