RE: What?I agree with you on this, although I still think that we have an undervalued stock here, the question on the spin out gets to whether the shareholders have received fair value. There are actually rules about this, and I can see the potential of a class action law suit here, if fair value is not seen as being received. It all gets down to a question of value, and maybe whether this is seen by some as opportunistic selling of an asset for gain by management. I do not agree with them putting it into a shell and diluting value,while appearing to make personal gain, as that appears to me to be the case, but time will tell, as it is a question this managment has to answer, or should be doing.
In terms of legality in terms of value? This is a question a lawyer should and probably will look at, as I see it. I for one wil be asking about this over the next while. I do know there is an area of legislation which deals with this issue of the disposition of assets and valuation.
Still, if they play, promote and get the value of HRG up, nobody will complain, as that is the way the Canadian stock markets seem to work. The question moving forward regarding assets being diluted in value at the expense of HRG shareholders, while some individuals get rich on these same assets might also arise. I can see law suits, as this does all seem a bit tacky to me. Why didn't they just form a new company and vend it in is a serious question, as any advantage in using this shell seems at first glance to be at the expense of current shareholders of HRG. Just my opinion, but there are parties with some serious money invested here, and they will be watching and asking questions. One contrary outcome might be this. Savy Canadian promoters know all of this, and as well know that if the shares of HRG were to plummet while others make fortunes on this asset then actions might occur, so what better strategy can one think of, than to have a stock drop, then announce a deal, and low and behold the stock rises making current shareholders "happy" and mitigating any thought on the whole process and outcome. As well, anybody notice the price action in the shell? Of course there was no leak of information before the deal was announced! LOL As I said previously: when you own 50% of something and you end up with something substantially less, with NO cash in the bank, but seemingly only owning less of exactly the same asset it is a real stretch to see it as better. It sort of reminds you of an orchestra, fine tuned to benefit the audience.
The costs to develop, are THE SAME, the difference is in who raises the money, who profits, when and the risks taken to do so. But the question of why not just sell it on the open market for cash or shares from a major is certainly a valid one. IMO