Verisante Technology Inc V.VER

RE: RE: The Mistake -S8

[natureboy16]

I think that MVW is an excellent analogue for mkt in a micro play on the SAB.   That mgmt team did not hide the fact that they need to raise about $30m very soon.  But they sent out the info of the land base and it's prospectivity first.  They understood that the share price would rise a goodly amount.  This would afford them a more attractive price to do the equity offering - read less dilution.  This is important for the pre-existing shareholders. 

VER broke that.  The new CFO, IMO, does not know how to deal with the investment bankers (nor does the CEO as he would have been in the same meeting).  The IBankers obviously convinced the mgmt team to do all the info release at one time.  They would have argued that it is less confusing to investors, and that mgmt did not have time to diddle-daddle around given the need for cash.   But the IBanker would know very well that no share price pop would occur, after having seen hundreds of previous deals in their career. 

This is an issue because the current shareholders deserve to have their shareholder value maximized.  This deal transfered significant value to the new shareholders that have not yet even become shareholders.

In nearly 30 yrs of investing, this is one of the most abusive deals I have ever seen.  At this point I think it is likely a totally ignorant and naive mistake on mgmt part based on inexperience.  I give the benefit of the doubt, but am wary that it may be worse. 

This is clearly only my opinion.  Do your own DD.

Deeply saddened that what could have been, is now impossible.  The deal is cooked and cannot be reversed.

Someone's head should roll - but of course BOD never do their job!!!

nb