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Yellow Media Inc T.YLO



TSX:YLO - Post by User

Bullboard Posts
Comment by markvrdon Dec 14, 2011 4:13pm
218 Views
Post# 19322867

RE: RE: RE: RE: RE: markvrd - logical choice for C

RE: RE: RE: RE: RE: markvrd - logical choice for CI took Chuck's questions to be a choice of C versus D preferred shares which I find very similar and would choose based on which has highest ratio of dividend to price.   A's and B's are a whole different thing because of their potential conversions to commons.   Assuming conversion of A's, they'll get you one more dividend and are very cheap.   They will almost certainly be converted to commons in april.   At current prices, this would be favourable since 12.5 x 19 = $2.38 and the A's are trading at 1.62.   Therefore, you'd get a 26 cent dividend and potentially an arbitrage opportunity to get some commons very cheaply.   This said, commons may get hammered by the conversion if/when it happens due to the dillution that will occur.   Nevertheless, the A's with their likely conversion to commons stand to bring you some short term gains.   They don't require you to hold past april to achieve your gains and therefore you would avoid insolvency concerns in 2013 and beyond.   It is possible that the company will offer another issue that A holders can swap their A's in for.   Such an issue would have a holder retraction clause beyond Dec 2012.   However, the one thing that is virtually certain is that you will have a choice of conversion to commons, sell on the open market,  or exchange for a new issue.   There is next to zero chance of a $25 retraction in Dec 2012.  I personally don't think the conversion to commons is such a bad thing and you would almost certainly make some money.
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