TURK SAYS: "By the way, I have challenged on several occasions any CLL or ANZ poster to furnish us with a copy of one YES, JUST ONE, buy recommendation from a reputed brokerage house. Challenge has gone unanswered. Wonder, why?
(Hah, Turk, my favorite adversary, thought it was Logan didn't you? Anyway...)
DON SAYS:
At the appropriate time, Antares exposed 5 major investment banking houses to its company. The bankers turned around and participated in a C$25 million private placement, which the word on the street says, had been offered for resale to institutional clients in 150,000 share blocks which approximates C$500,000 per unit. The deal was announced on March 7th.
It is reported that the funds transfer to Antares will take place on Tuesday, March 18th.
These "special warrants" only become common shares after clearing a prospectus sometime toward the middle or the end of summer, '97. No trading of these warrants is permitted until they are converted to shares.
As much as we would all (especially me) would have loved for Antares shares to scream onward and upward, the reality is that the underwriters have undoubtedly used the March 7-18th period to continue the purchase of additional "free trading" shares of Antares in the market for their institutional clients. I for one looked for a C$5 close on the 11th, but was foiled by my own naivete in this regard.
Last week's treading volume suggests that there must not have been much supply, but whatever was offered was bought and the stock continued last week to close above the private placement pricing of C$3.35. I observed on numerous occasions last week that Canada-Stockwatch reported members of the consortium as being the buyers.
When the deal closes on Tuesday, Antares will have its money, the institutions will have their restricted AND free trade positions and the bankers will have their fees and trading profits.
Undoubtedly, Antares shares will rise and the bankers will probably transfer to the institutions the free trade positions taken down at prices ranging up to C$4.35 just prior to the announcement of the deal on March 7th. The live embers still glowing under Antares will undoubtedly be "fanned" by the bankers and institutions between C$4.35 and C$5.00 next week to shake out additional shares from the market.
So...to speak directly to your challenge...it is MHO that then it will be time for the bankers to "unfurl the research reports" to support what they just sold to the institutions. If nothing happens with the Ojolali and Rappa during the period up to and including the end of the hold period of the special warrants, you can probably bet that Antares will move at least to the C$8-10 range as the bankers seek to keep their institutional clients happy by having them "cost out" or "cost down" by selling the free trading stock purchased between C$3.35 and C$4.35.
An institution that buys 150,000 restricted special warrants at C$3.35 and 150,000 free trading shares in the market will "cost out" if the research reports keep Antares in the C$8-10 range long enough.
Just like the small investor, the bankers and institutions want their cake and eat it too. They get their way by :
1. costing out by the end of the hold period to ease the selling pressure when 7+ million shares hit the market later in the summer...
2. ...at a time when results from the Ojolali or Rappa justify a further move in Antares share price above the C$8-10 level...
...in order to create a fabulous profit situation for themselves.
Research reports come out WHEN bankers and institutions want to SELL stock, not when they are smack in the middle of buying it from, as you say, the doubting Thomases, Andrews, Turks and, and let me add to be fair, Dons.
You asked "why," Turk. Wouldn't you say the above is a highly plausible account that ties up all loose ends and subdues any need to wonder? I am hoping at some point, Turk, you will cross the threshhold of reasonable doubt due to the weight of the evidence. Also, ask yourself, "has my Bre-X performed as well as ANZ since the first of the year."
Don |
