Value destruction by Contel

I pity those investors who are vested in Contel since their IPO days (although i dont think the number is high). 1.5 years ago, i had a posting, in which i advised all investors to avoid Contel due to its constant and urgent need for capital. On top of that, free cash flow was non-existent.
http://level13-analysis.blogspot.com/2007/07/raising-capital-at-contel.html

Let me do a recap on the amount of money that Contel raised ever since it was listed and you can make up your mind if it was indeed a value destruction job.

In Dec 2005, Contel was listed at an IPO price of $0.22. It managed to raise $9.1 million. There were about 250.92 million shares outstanding. Thus, the market cap was around $55.2 million. At that time, the book value per share was $0.162.

On 7th June 2006, Contel announced a proposed issue of up to $50 million in principal value of non-interest bearing equity linked redeemable structured convertible notes due 2011 in ten equal tranches of principal value S$5 million each to Advance Opportunities Fund. Investors should head for the nearest exit when the news was released. In a report
http://www.sfc.hk/sfc/doc/EN/speeches/public/surveys/07/exchange_audit_report_070404.pdf by the Securities and Futures Commission on the 2005 work of the Stock Exchange Listing Division published in April 2007, the SFC said (para. 48, p.12):
"In the last few years, several companies issued a particular type of convertible note, now commonly referred to as "toxic convertibles"... In the absence of other factors, each conversion is likely to lead to a reduction of the issuer's share price and an increase in the number of shares into which the remaining notes can be converted, resulting (because of the falling share price) in a spiral of further dilution of existing shareholders and reduction in share prices. In the worst-case scenario, the notes are converted into shares at the par value and the convertible noteholders may end up holding almost all the company's shares."

In June 2007, after taking $26.5 million from Advance Opportunities Fund and seeing the outstanding number of shares balloon to 417.85 million, Contel terminated the subscription agreement of the convertible notes.

In July 2007, the company decided that it needed more funds and so set up an arrangement with ABN AMRO Bank relating to the issue of US$8 million (S$12 million) zero coupon convertible bonds due 2010.

In Dec 2008, Contel made a private placement of its shares and raked it another $2.167 million.
As of 30th Jan 2009, the number of shares outstanding is 486.6 million.

The downfall of Contel is complete with this announcement on 31st Jan 2009. http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_D44C1AC0FBF95ECC4825754F003F55A1/$file/Contel_Galaxy_Business_Disposal_Annc__finalised.pdf?openelement

From the period between Dec 2005 to Jan 2009, the total amount of cash that went into Contel was nearly $50 million. However, the amount of dividend it paid out was ZERO.