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SPROTT RESOURCE HOLDINGS INC T.SRHI

"Sprott Resource Holdings Inc invests and operates, through its subsidiaries, in the natural resource sector. It has investments in oil and gas exploration, production and services, mining and agriculture."


TSX:SRHI - Post by User

Comment by quicksilver545on Feb 19, 2017 5:05pm
212 Views
Post# 25867821

RE:one disappointed investor

RE:one disappointed investorUmmm.. you need to understand your investments a bit better...

If you bought ADI prior to the merger, you received a 1:1 ratio of old ADI shares to new SRHI shares. In addition, ADI shareholders received a quarter warrant for every ADI share held. I am guessing that is what you are seeing when you quote 7 cents per share. The warrants have recently traded for as much..

SRHI last traded around 21 cents, so you have made both a profit on your ADI shares, and received .25 free warrants. This was actually a pretty good arbitrage for a while as ADI was trading at only a small premium to old Sprott. Post-merger, you could have exited at 23 cents, though it has traded down to 21 now.

Fair value for the new Sprott is certainly much higher, especially with the way iron ore has traded recently. I see it trading in the mid to high twenties if commodities continue to do well.
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