OTCPK:RKNLF - Post by User
Post by
a1broker1on Jul 14, 2017 3:41pm
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Post# 26470899
Institutional Holdings, Currency Fluctuation
Institutional Holdings, Currency Fluctuation
Good work regarding SEDAR filing. Still, it's encouraging to to see Fidelity has such a large holding. One wonders if Eric Rosenfeld's Crescendo Partners is still holding shares or what other institutions have increased their holdings in the last month or so on the very large volume days to secure additional rights under the rights offering.
The appreciating Canadian dollar is also a positive for current shareholders as it will decrease the Canadian dollar equivalent of $0.50 USD which is the exercise price to obtain additional shares at an extremely deep discount to the current share price. As an approximation, the Canadian equivalent has decreased from a peak of about $0.67 CDN to as low as $0.62 CDN, so the attraction of exercising the rights has definitely improved.
Regardless, the rights offering is the most shareholder friendly event that has been offered to shareholders since ESW came on board to right size RKN's balance sheet. And shareholders should not forget that ESW initially purchased many millions of shares in the $1.50 range. Once the rights offering is completed (which is actually negative dilution, thus accretion to existing shareholders due to the discount), the balance sheet will be even more solid, with enough cash to fund the restructuring, refocus the company, and ultimately lead to growth in both cash flow and earnings. Once that occurs (probably in 2 years), the company with no debt will be very ripe as a takeover target.