GREY:RIVVF - Post Discussion
Post by
Metalsguy1 on Dec 18, 2017 4:26pm
Retail Shareholders in RioNovo should have been kissed first
There is a very off putting odor arising from this deal. So this is how I see it. Britos owns just north of 50% of Aura. He owns nort of 60% of Rio Novo. After more than a year waiting for management and the board to move after the updated DFS we get 10 cents CAD per share? And what does Britos get? If my understanding of the deal and the numbers is correct, Britos is conveniently getting considerably north of 10 cents a share.
Just for argument sake let's use .30 cents a share as a proposed value (even though I believe it is actually higher than this) based on the DFS, and the other assets in the company that have not been thoroughly evaluated. All of the shareholders in RioNovo appear to be getting the same deal. However, I don't think this is true. As a shareholder (part owner) of Aura, it seems that he benefits disproportionately on this deal compared to shareholders who only own stock in Rio Novo and none in Aura.
If a more realistic value was 30 cents CAD then Aura is getting the deal of a century buying this company at a 66% discount at the expense of the shareholders in RioNovo...but not all shareholders. As a shareholder in Aura, Britos essentially benefits from the discount in proportion to his ownership of shares in Aura.
Add to that the fact that Britos has been converting debt to shares for years and always at the rock bottom of the share price.
If my logic is incorrect, someone chime in here because at this point my blood is at a simmer. I will be voting no on this deal without question.
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