Hoghead, I agree with you. Maybe they can do it.
Zep, you tell us, what can they do to prevent the dilution? They need money to pay themselves and to do anything useful with the properties they acquired. Nothing is currently viable as a property to divest. Teck is unlikely to provide a decision and $20M anytime soon. Tax credits are just that, until they get a cheque in the mail. Another company I invested in has tax credits coming and ran into trouble because they loaned (in 2011) against the refund, and it has still not come.
I can give you a list of companies that released news about a consolidation and dropped like a stone. I did not pull that number from the air, it is a normal reaction immediately or over a few days as it sinks in. CUU news tends to be superficially positive and often gets a quick bump, then the fall afterwards (last week, for instance). What happens when they give bad news, say like the BFS? I'm not speculating, I'm basing my thinking on the normal patterns in the venture market.
Like Elmer, I invested in a prospect junior exploration company last summer. It doubled on anticipation of results, and a little bird kept pointing out the chinks in the story (thanks!), so I finally sold and preserved some of the profit. Made a nice little bundle and was reminded that a good story does not always work out. I took the risk with my money. Elmer did the same thing with CXM. But instead of a liquid position that could be sold in a few seconds for $7, it is a holding that can't be sold, and now begs to be supported with more cash. He did it with shareholder money. Managed to get himself a position on the board out of it too.
I'll finish by saying they need to do this. Whether people like it or not, this company needs money to do what they have started. Anyone who did not like the AZ and CXM buys has had ample opportunity to sell and move on, but now it is the main business of the company. CUU needs money and a PP is the normal way to do that. That is why I am waiting, that is a real catalyst for making money. I'll be calling the office for that PP. I'll be long on warrants if the price is right. |
