Stelco Holdings Inc STZHF

Dutch Auction explained...

[sunshine7]

"Dutch Auctions are a proven, effective buy-back vehicle for companies whose securities are not broadly traded."

Candidates for a Dutch Auction often share the following characteristics:

• Accumulated excess cash (for example, from a recent sale of assets) or a steady cash flow,

• Stock that is currently under-priced, yet showing strong revenue and earnings growth, a situation that could be a result of under-coverage by the investment community,

• Low daily trading volume, favoring a structured offer rather than open market purchases to ensure market and price stability,

• Presence in a sector which is suffering under general market pressure,

• The desire to reduce small (also referred to as “Odd Lot”) shareholders through the buy-back
  
  A Dutch Auction is an offer to buy back shares for cash. — Laurel Hill Advisory

[CHECKMATE77]

I don't think they are going to get many shares. the market price would have to be lower then the auction price to be filled. Now if I owned 500,000 shares and wanted out , maybe , since my selling would crush the share price . Retail will not be selling .

[fishcarrier]

I don't think this would even deter short-sellers. STLC hasn't been as low as $31 since July. I totally don't get this. Unless it's an invitation to let Goldberg relinquish his remaining stock. But why would he? 

[extremerisk]

He has one year lockup from last sale in august so he can't.  This deal ends Jan 26 2022.   Done strategically to be before year end results due to be released in feb 2022. I think since last buy back did not work.  Shares kept going down why bother doing that again.  Establishing a hard floor at 37 I like as shorts will have trouble getting this too low as company

[Eastbank]

This proposal is definitely a head scratcher! It makes no sense whatsoever.

[marsman1]

I think this board is beginning to understand the dynamics of Goldberg , and Alan and Bedrock. When the company bot shares from Bedrock, Alan thanked his "partners," for selling at a price under the then value of the shares I had to laugh , as Stelco was in effect buying shares from Alan (Bedrock) and those shares cost next to nothing.