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Sokoman Minerals Corp. V.SIC

Alternate Symbol(s):  SICNF

Sokoman Minerals Corp. is a discovery-oriented company with projects in Newfoundland & Labrador, Canada. The company's primary focus is its portfolio of gold projects along the Central Newfoundland Gold Belt, and the district scale Fleur de Lys project in northwestern Newfoundland. The company also recently entered into a Strategic Alliance with Benton Resources Inc. through three, large-scale joint-venture properties in Newfoundland


TSXV:SIC - Post by User

Comment by AlwaysLong683on May 19, 2021 1:45am
164 Views
Post# 33228136

RE:RE:RE:ES Overhang

RE:RE:RE:ES Overhang BC, I would argue that, in many instances, market players consider the probability of an anticipated result and position themselves according to what is likely to happen before that result is confirmed.

If the expected event occurs, not much changes re. share price as the expected event is already "baked into the cake".

If the expected event does not happen, THEN there's a big move in the share price as investors scramble to adjust to the unexpected new reality.

For example, if a friendly takeover offer is made for a given company at a 30% premium to the average share price over the past 30 days (or whatever the agreement entails re. the share price equivalent) and the share price of the takeover target jumps 28%, it does so even though its still not a done deal - the offer has to get shareholder approval, and that could take some time (need to set up a special meeting, etc.), some shareholders may even be vocal about not accepting the offer, and regardless, it's possible the offer could be voted down. However, the probablility that a friendly takeover offer will be approved by shareholders is typically high, so the price usually jumps to almost the amount of the premium shortly after the news is released, often settling a little short of the takeover price to account for the slight possibility that the proposal could be voted down.

In SIC's case, I believe the market expects shareholders to approve Eric Sprott becoming a new Control Person as management seems to be on-board with it and have likely made their case to shareholders during the Special Meeting that was supposed to be held May 18 (I still haven't seen any news from SIC re. the actual occurance and conclusion of the meeting nor its results....?).

If, as expected, Sprott is confirmed as a new Control person, I don't think the share price will move much.

However, if he is NOT confirmed, this will take the market by surprise and cause great volatility in the share price.

Of course, I could be wrong about this, but I doubt it........



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