RE:RE:Offering is $4.90 but trading for $5+If you have concerns about closing, you are better to buy the SR, so you get a refund if it doesn't close. If you want to ensure you own the stock even if the deal fails, yes, you could just buy the units on the market. I would think most investors will see this deal as a positive, and therefore go for the SR. Plus SR buyers get distributions, which is not always the case, and so they should not trade at a discount.
As for RBC coverage, yes you are right there is no certainty of a BUY rating. But if you look at a typical IPO, in Canada or the US, shortly after the closing all the brokers in the deal launch coverage with positive views. Despite 'suspicion of impropriety.'
CashHungry wrote: The $4.9 was for $55 mil (only about 25% of the financing) and it was for subscription receipts (conditional on closing) which normally have a stock price lower than bought deals with no condition. SOT.UN went this route because they did not want to be held holding a large chunk of cash in the event the deal did not close.
I am not surprised that the shares are trading above $4.9. The other components of the financing look pretty good, especially the $134 mil secured bond with the attactive interest rate of 2.65%.