RE:RE:RE:RE:RE:RE:RE:New Press Release - LAURION ANNOUNCES PROPOSED NON-BROKERED PRIVATE PLACEMENT OF FLOW-THROUGH SHARESSo I usually try not to be glass half empty or glass half full, I like to try and think from the perspective that the glass in question is simply twice as big as it needs to be. Like many on here, to me, the face value of this news does not promote a glass half full view.
Part 1.
So LME issues 4,821,429 FTS to a purchaser, further diluting the total shares outstanding by that amount. Previously we had 262.2M shares outstanding. Now we have right around 267M shares.
If LME were bought out yesterday say for 1B (Matlas I know youre going to say that this is FAR too low, I agree 100% but for the sake of easy numbers this is what I chose haha)
So say we had a buyout of 1B yesterday would have worked out to 3.81 per share. for someone who owns 100,000 (another nice round number number) shares they would have recieved $381,388.30
So say we had a buyout of 1B today it would work out to 3.75 per share. for someone who owns 100,000 shares they would have recieved $374,531.80.
A difference of about $6,856.50. Not life changing money but still less, and less never sits well with me. So thats the negative side of this to me, I cant help but wonder how this is in my best interest as a shareholder? To me the only way this is positive for myself is if this is being done to help close a deal.
Part 2.
Initially I wondered... If it is for taxes.. well Is the tax savings the comapny gets from diluting ourselves really worth it to individual investors? Matlas maybe you have insight into this further. Also, I really like your comment "This may be a "sweetheart" deal for F&F of F&F to allow them to get tax writeoffs and shares at a low price" This is definetly a possibilty! I would even venture to speculate this is some type of an inducement for the buyer to complete the deal (more on this below).
As Fatlas mentioned the issuer may not have been the sole decider on price and the fact that the price is at a premium of 0.56 relative to todays stock price we should count that as a win.
Steve you said "The issuance of this flow through is BAU and hasn't got a thing to do with M&A, USCG, special committee etc..." Can you confirm that is an absolute and not strictly your opinion on the matter? (I do value your opinion but knowing that its LMEs official stance as well is helpful)
Furthermore there have been full subscribed private placements in the past and i believe it to be the same buyers. So far there has not been any this year, likely knowing that a buyer(s) is at the table and didnt need any further funding (as we already have a pile of cash).. so why go through all of this? The buyer (aquiror) doesnt want the credit to evaporate so they stepped up and bought up the credit for them to reap the benefit on both the shares and the tax credit itself.
Steve I was just about to post this and refreshed SH and saw your post "I can now confirm that the buyers of this flow through issue are the same buyers of the previous 4 flow through issues. All existing, significant shareholders. " Thank you for strengthening my theory!!!
Part 3.
Ahsineeg had posted case studies a few months ago. I would like to revisit this topic (ahsineeg if you have more case studies please feel free to share them)
A brief review:
Premiere Gold formed a special committee Oct 16 2020.
Premiere Gold engaged a Financial advisor Oct. 27, 2020
Premiere Gold issued a PR for a deal Dec. 16, 2020
66 days total from special commitee formation to deall announcement.
GBR formed a special committee Nov. 10, 2021
GBR engaged a Financial advisor Nov. 14, 2021
GBR issued a PR for a deal Dec. 8, 2021
28 days total from special commitee formation to deall announcement.
Kirkland formed a special committee July 5, 2021
Kirkland engaged a Financial advisor Aug. 15, 2021
Kirkland issued a PR for a deal Sept 28, 2021
85 days total from special commitee formation to deall announcement.
The thing that stands out to me with this deal is there was a really long gap between special comittee formation and FA engagement. once the FA was engaged it only took 44 days to announce the deal.
LME formed a special commitee at some "recent" point before August 23, 2023
LMe engage a Financial advisor Aug. 23, 2023
65 days total to date since engagement of FA...and waiting.
Still not sure exactly how I feel about the news today, I stand hopeful knowing that we are at the point where USCG, special committee so I am still hopeful that this year will be "Cynthias Swan Song"! If not, Steve you might need to stick around past February! Lord knows we need you to keep order haha
Note, Primpage deserves some credit on information in this post!