SYTE Buys Back Debentures To Strengthen Its Stock
Jan. 15 - Sitestar Corporation (OTCBB: SYTE) has launched a tender offer to buy back its currently outstanding convertible shares, valued at $475,000, including interest and a redemption premium, funding the deal in part with capital gains from its recent sale of its holdings of TriVantage Group, Inc.
Less the two months ago, Sitestar repurchased 10.6-million shares of SYTE common stock in negotiated deals with private shareholders. It represented about 11.5% of the total outstanding shares of SYTE.
The buybacks were made in an effort to boost the price of the company’s stock. The November purchase did little to achieve that goal, though the stock rose from 0.025 to close Monday at 0.055.
But Sitestar management clearly aims to send it toward 0.20 where it was when it began a downturn. The effectiveness on Monday’s offer remains to be seen.
“By redeeming the convertible debentures,” said CEO Clinton J. Sallee, “we eliminate a dilutive event for our shareholders and secure another step in the development of long-term shareholder value. This initiative, combined with our recent share buyback, will greatly enhance our shareholders' position.”
Shareholders were pleased. Said one: “What do you think of the SYTE release about redeeming the debenture? That’s kind of unheard of in OTC Land, isn’t it? I think it’s super news. I think the share buyback and redemption of cd's will go a long way to curtail MM Manipulation.”
To swing the re-purchase, Sitestar divested it equity in Tri-Vantage, cashing in on the value that had accumulated in the stock in less than a year. Sitestar made over 400% on its investment. It will take a capital gain of about $225,000 off the sale.
As part of the deal, Sitestar re-acquired its software and content development division, which will be reincorporated into the company.
Sitestar's wholly owned subsidiaries include Sitestar.net, Lynchburg.net, Computers By Design and Advanced Internet.
Sitestar characterizes itself as “a publicly held investment company that acquires and invests in emerging technology-based enterprises. Its primary focus is the acquisition of small independent Internet Service Providers in the rural and secondary markets of the mid-Atlantic region of the United States. Sitestar's wholly owned subsidiaries provide narrow and broadband Internet access, electronic infrastructure development, Web-hosting and design services and other technology-related solutions to residential and business users.”
Sitestar's wholly owned subsidiaries include Sitestar.net, Lynchburg.net, Computers By Design, Advanced Internet and Sitestar Applied Technologies. |
