TSX:RPR.DB - Post by User
Comment by
Tree2treeon Dec 02, 2024 8:32pm
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Post# 36341885
RE:RE:RE:Now that Armoyan has control I will evaluate his performance
RE:RE:RE:Now that Armoyan has control I will evaluate his performanceI don't think GA needs to rob the debenture holders in order to make money from this opportunity. I assume he invested in SOT because he saw the value of the assets (and how previous management was wrecking it), not because he had a plan in mind to cheat the debenture holders out of their share. Since his first investment, things obviously went downhill, but (a) he succeeded in booting out the Leech Bros, and (b) interest rates are starting to come down, and office space is no longer considered worthless.
As for the common share price 'holding up', I think some people buy them as a lottery ticket, based on general optimism and not detailed calculations based on concrete scenarios. If I wasn't all-in on the debentures, I might consider buying back some common shares. (My partner is holding some and I don't think she's crazy.) IMO a straight buy-out offer for the common shares is still a possibility - and I think it would be a bargain for the right buyer.
And if the acquirer is in a position to purchase a chunk of debentures at a discount to face value, it would become an even better deal. Essentially they would be retiring a portion of the debt at a discount, and thereby increasing the net value of the company.