GREY:LGVWF - Post by User
Comment by
Nawaralsaadion Feb 05, 2014 9:56am
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Post# 22173917
RE:RE:RE:News Release
RE:RE:RE:News Release2m shares would cost the company $8.9m at the offering price. They have ample room on their credit lines to spend this amount, and considering, the dividend on those shares is 10.8%, while the interest on the loan is around 3%, they would be saving at least 7% or $620K a year in cash outlays.
This offering was very poorly handled; no stock can handle an offering of 45% of its shares, no matter how much demand there is for the equity. As a matter of fact if I was an Advantage shareholder, I would be even more frustrated since it seems they left a lot of money on the table by exiting in this fashion.
In my opinion, they should have extended the AAV review until a block buyer could have been arranged for some of those shares or all of them at prevailing market prices. I have already sent the CEO and the Chairman a stern letter as a result of this poorly designed and timed offering.
I guess the other silver lining beside Advantage getting out of the way, is the removal of a 45% major shareholder, this could facilitate shareholder action down the line should the company fail to execute in 2014.
Regards,
Nawar