Dominion Bridge Corp. (DBCO) Message Board

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Microcap & Penny Stocks : Dominion Bridge Corp. (DBCO)

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To: Baoho Chang who wrote (395)	1/24/1998 10:01:00 PM
From: Chien Li	Read Replies (1) of 535

Baoho, My two cents is that the offer prices are $3, so Sanda gets a ~15% discount. This is common in the convertible stock deal, although this one is not. Doing so, Sanda controls 20% of the company and has the opportunity to get more if the offer price moves higher due to a bidding competition. That would explain the $3 warrant incentive. Since Sanda knows what the offers are, SEC regulation would prohibit it from buying DBCO shares in the open market. The motive for DBCO simply is that it needs the working capital NOW to keep the business going, yet it does not want to rush to sell the company cheap. So they arranged this private placement. Chien-Wei

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