Lanesborough Real Estate Investment Trust V.LRT.UN

RE:RE:RE:RE:RE:RE:It passed - 33 000 000$

[quicksilver545]

Well now that the transaction is going through, hard to know where the dust settles. We will go from a share count of 20M to 675M. Previously, at 2c and 20M shares, our market cap was 400K (not even 1 million). 30-day average volume stands at 25,000. At 2 cents, that's about $500 per day in volume... This stock has almost zero liquidity.

At 2 cents and without consolidation, market cap would balloon from 400K to 13.5 million. I don't anticipate that the market is suddenly going to value us 33 times higher for extinguishing the debentures. So we will undoubtedly trade lower. Even at the minimum bid price of .005, we would sit at a market cap of 3.375 million, which represents an 8x on our previous market cap. And I imagine some peple will want to dump their new shares once they are received. L2 data suggests there is around 3 million on the bid around .005 cents.

Of course there is some value in the company extinguishing 33 million in debt, and eliminating the debt does take us off the brink of receivership temporarily. Assigning value to debt extinguishment is difficult, but I could see a ten percent value of the debt, at 3.3 million, being reasonable to add to the overal market cap. So we may hold between half a cent and 1 cent, without any new news. 

In any case, will be interesting to see where we shake out at now. I am somewhat surprised that so many debentureholders were willing to give up secured debt for units that have almost no liquidity, but hey, maybe i am missing something. GLTA