There was a really great company with a ton of great products, but they also had a ton of debt. To execute on their strategy, they needed more capital, however, a shorting group had been attacking the stock for a year and doing an issue at the low price the stock had been driven to was not palatable for the company.
The short group was unrelenting, knowing the company needed the capital and the outcomes they wished for were either the company couldn’t raise the capital and they would go out of business or the company did an issue of shares at the artificially low stock price and they covered with the issued shares.
The Co. hatched a plan. They decided to go through a CCAA process which would protect them while they worked and they could even remove the shares from the market for a period of time. This would completely stymie the short group while they continued to build the business. They got buy-in from their largest shareholders and their creditors before they entered into the CCAA. Their hope was that they could exit the CCAA in a much stronger position, list on a lesser exchange, at a much higher price and then do the issue. Maybe it is a smaller issue share count-wise and the shorts will have trouble covering the number of shares they have shorted, driving the share price much higher.
Now the accountants are putting out updates that look surprisingly ahead of schedule and some opinions are that the company should never have gone into CCAA, that they didn’t need to,……hmmm.
This is just a story I made up.