RE:RE:RE:RE:RE:RE:The clowns have stopped selling it offWith that massive volume of shares being tied up in a "personalI financing transaction", you gotta do better than (1) firstly telling people about the purchase of puts and calls on IVN shares (!), and (2) even in the corrected press release leaving things murky by telling details but being incomplete. Anyway here is the literal excerpt from RFs press release with a few underlinings from me (so no need for us to go back and forth here):
"Rather, the personal financing transaction with the commercial bank may, in some circumstances, require Mr. Friedland to deliver Ivanhoe Mines shares at maturity or on default to settle the transaction, but it also grants Mr. Friedland the right to settle the transaction in cash, a right he intends to exercise....................
The commercial bank obtained no rights to dispose of, sell, transfer or vote, any of the pledged common shares or other shares of Ivanhoe Mines until maturity or upon the occurrence of an event of default. Mr. Friedland continues to retain all rights of ownership over the pledged common shares.
So, in conclusion and in RFs words here are the facts:
- this is a "private financing transaction" (the word loan does not show up)
- RF intends to settle this private financing transaction in cash and not in shares (so this is not at all about divesting etc....)
- the above excerpt states clearly that the counterparty to this financing transaction has rights to the shares upon default and also (!) on maturity of the loan (which RF can avoid by settling in cash or repaying the amount owed).
And my five cents in conclusion : assuming the investor relation guys at IVN gave a bit more attention to detail and wording: this is not a standard loan, but a structured financing transaction with a commercial bank as a counterparty with settlement options upon maturity of the transaction (subject to RF repaying) but also the right of the bank to sell the shares on maturity or default. These financing transactions serve legitimate purposes, i.e. protect downside risks or also leverage the upside; call and put elements are usually part of the contractual structure of such financing transactions (therefore IVN corrected its release by saying " we did not buy puts/calls").
Anyway: no divesting (the old man said it, see above cashtango), it is a financing transactions with a few put/call elements alluded to (but does not provide for a clear picture). Final point: both the release (dead-wrong) and the corrected release (trying to correct and give a bit of detail; which you should never do, bc you either open the kimono or not !) leave the reader confused,..and for a listed company, nope: you gotta do better next time folks.
And for us: we should be critical, even if at times it does not suit our position/or trading strategy for IVN. Okay !