GREY:CXEYF - Post by User
Post by
eventtraderon Mar 26, 2010 3:23pm
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Post# 16929472
Dilution? What dilution?
Dilution? What dilution? They aren't going to steal shares on the cheap. The exercise price of these warrants is a moving 5 day average. The warrants will enable Geofinance to go from from 42% to 58%.
Any ideas why they would structure the deal using warrants with a moving average? One reason that comes to my mind is that it might give themselves flexibility to determine at a later date if they want to consolidate CAX as a subsidiary or just treat it as a single line in their financial statements. Makes more sense given the pending takeover since give the the new controlling shareholders flexibility.
Or.. this makes even more sense... the warrants are probably going to be allocated to the Geofinance managers, so that they have have a direct stake in Candax. No free lunch though -- they will have to buy in at market prices.
SLB has made some other interesting acquisitions:
https://www.epmag.com/archives/newsAnalysis/403.htm
https://www.investegate.co.uk/InvArticle.aspx?id=60781
Anyone want to venture an estimate of what the Madagascar exploration block is worth?