RE:HWO: don't think ppl understand the situation, have a read Resilience2: Thanks for your post.
I think that most of the investors understand the situation very clearly You hit the nail on the head when you mentioned that you're unsure why the company needs to be made private. This is the elephant in the room. Furthermore, if the alloted value is greater than the RoC payout (which given the book value PNG/Canada spread is likely the case), why on Earth should investors be forced to invest additional funds to maintain what they already own? This is given the fact that the company does NOT need to raise capital. For example and to make the math simple, an investor might own 1 million shares. At a valuation price of $1.00, that investor needs to find an additonal $250,000 ($1 - $0.75 RoC) to give to the company to maintain the shares HE ALREADY OWNS in the PNG private entity. This, IMO, is ridiculous. The more stock a retail investor owns (minority shareholder), the more he is punished. I say retail becuase obviously Cyrus can come up with the extra money.
Also, most of the investors here have stayed the course and remained invested due to the expected ramp up in PNG in the first place (and that has been for several years now - pre Covid). Investors understand that we're entering a secular bull market in PNG. What is the exit strategy for current investors if PNG is privatized?
I think Auburn mentioned that he cannot hold private shares in his TFSA. What happens with other tax-deferred or tax-efficient accounts? Tell me, how does one come up with additional funds in their RRSP (when they've already maxed out)? They cannot and by de facto, get the shaft.
This privatization REALLY SCREWS current retail shareholders more than we can imagine...and we can imagine quite a bit.