Short Selling has value for Hedge funds
One example is this, if you know a stock is going to be down rated, by the rating agencies, then shorting that stock in advance, will allow you to buy back at a lower price.
June 30, 2020
If you know that NVA was going to have their banks cut their line from 550 million to 475 million when they are already sitting on 450 million in debt, that might be a good reason to short the stock.
OCT 1, 2020
POU acquires 17.3 million shares of NVA at .61 cents, what do the share holders think? they sold them to POU for 61 cents because they want to give them a good deal? No, their was no liquidity for the shares and the other big block owners did not want the shares. If those share hit the market, NVA would be trading for 20 cents, NVA shareholders owe POU a debt of graditude.
Nov 1, 2020
The current bank debt was just around 400 million at the end of the 3rd quater, however the banks given the opportunity cut NVA bank like futher to 440 million dollars, from the 475 bank line they had established 3 months eariler. To say that the EDC letter is not part of the syndicate is an untruth in my opionion. The banks action suggest they are worried about their equity, strange when you consider there is 220 million of bond holders with higher risk, and about 200 million is share holder equity that carries the largest risk.
Net debt reduction 34 Million
On might think that reducing the debt by 15 cents per share in the third quater, would move the share price up by at least 15 cents a share, but i would say all paying off the 34 million in debt did for NVA was to allow the banks to back off more on the financing of the company.
DEC 31 Debt Reduction
Basicly NVA is drawing down their resource reserves, and paying down get so that the company can be made more attractive, and make a takeout feasible. Really do you think if they pay down say another 34 million in debt next quater, the stock will go to a dollar?.
Revolver
NVA has a revolver pointed to its head with one bullet left in it chamber, the trigger has been pulled 5 times, and the next pull of the trigger is The End.
IMHO