RE: Why the selling?CE,
A few thoughts.
1) The worst thing about the large number of shares is what it tells you about past management'[s stewardship of the financial resources rasied previously in the capital markets.
2) A reverse split is probably the way to go if they want to return to the capital markets to raise money, since many sources will not consider a stock trading under a certain nominal value - say $1.00. A reverse split doesn't really affect the value of your holdings; i.e.,
10,000,000 sh @ $1.00 is the same as 1,000,000 sh @ $10.
True, you lose the share multiplier, but with 500,000,000 sh @
.10 the multiplier is not going to do much for you anyway.
3) I do not think a share buy back is the way to go. If they expend their cash to buy back stock, they have to replace that cash somehow---by selling stock?
Cash buy backs work in cases such as Altius where their stock was selling for less than cash value, which is not the case here.
4) I suspect that the Aussies will run this show and the ADA legacy mgt will be puppets with office spaces and token titles while they develop an exit strategy for them. It would not suprise me to see the Aussies use the RRO assets as an exit strategy for the legacy mgt and spin them both out the door together. But who knows; maybe they see value in RRO, also. Give them time to see where they want to go.
5) The barite investment may have been made on the basis of a new up and running Newfoundland refinery which was killed by the world wide financial fiasco. Does it have much market value?
Anyway, I hope it all works out well for you.
Kind Regards,
JA_P