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First Uranium Corporation T.FIU



TSX:FIU - Post by User

Post by AIGswapon Jun 13, 2012 4:16pm
305 Views
Post# 20010219

Value

Value

At current spot F/X, initial equity distribution is down from 0.22 to 0.19.  Of the US$405mm deal value, shareholders are entitled to ~$70mm.  The stock is essentially a 7x levered bet on the USD and therefore highly risky.

Also, the shareholders may see some of the escrow, but IMO i don't believe they'll get all of it.  Shareholders pony up 83% of the escrow (vs convert holders) and take first loss.  Ie the escrow will need to decline 83% for any convert holders to take a loss.

Assuming F/X rates stay constant, and there are no additional costs and zero escrow is used up (not very likely), shareholders may get 0.30.  IMO the stock at 0.25 isn't a great bet (no position).  This could be worse if Olma & Co choose to sue.

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