North American Palladium(AMEX:PAL)- PGM Producer Message Board

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Gold/Mining/Energy : North American Palladium(AMEX:PAL)- PGM Producer

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To: Elizabeth Andrews who wrote (545)	4/4/2000 3:37:00 PM
From: Ptaskmaster	Read Replies (2) of 976

There is arithmetic dilution by the numbers. And there is the role of dilution in financing and cleaning up the balance sheet, as well as the perception of dilution from the investor's viewpoint. The arithmetic is with 12.2 m common shares outstanding, and say 6.0 m newly issued in equity financing, a total of 18 m common is moderate dilution. If cleaning up the balance sheet is a primary goal, then Kaiser-Francis' 10 m Series A preferred shares might be converted to common, say 10-12 m or more common, for a total of 28 m, minimum. In my view this would be substantial arithmetic dilution. The dynamics between the underwriters and the market will determine what the new equity will sell for. You suggest that the company might be able to sell them at C$8 or so, I think it could be much less. Ptask -------- Sources used: NAP Annual Reports, and napalladium.com

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