What Happened YesterdayThis is the way I see it:
It is no accident that the "bad" report was released by the company on the same day that First Silver Reserve and First Majestic were to merge. The company did not have to release that report, but rather chose to release the report on the same day.
This is because of the way the merge was structured..... FSR shares can be traded 2 for 1 OR BE REDEEMED GUARANTEED for C$2.15 each. So in order to save FR at least 10 million on the aquisition they want as many FSR shareholders to chose the later option (cash).
On this past Monday morning, the options would look like this:
Take a C$5.00 FR share for 2 shares of FSR / or the guanteed cash of $C4.30 (2 shares of FSR cash value = 2.15 + 2.15).
After the bad story plant and subsequent dumping by intermediaries on Thursday morning:
Take a C$3.40 FR share for 2 shares of FSR or the cash - C$4.30.
By making the cash option more appealing, FR saves at least 10 million bucks !!!
Is this illegal ? - certainly yes.... Should FSR shareholders be outraged ? certainly yes .... Can you prove this in court.... I doubt it.
World is full of greed and avarice.
Question: How long does the FSR have to redeem shares for option a or b?