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Hello buylowsellhigh: This happen in 1995--1996 so my recollection is somewhat sparse: In 1995 there was a merger proposed with GNU. It was completed and the shareholders of Waddy Lake received .53 of GNU for every share they held of Waddy. At the time Waddy Lake have reserves of 1.2 million tons graded at .42 ,with apprx 16milion shares O/S..Prior to the ammalgation they ran the stock up on new drill results and we sold...but I am sure there were shareholders who held..they suppressed stock at .80 and GNU was trading at about 1.60. With the amalagation it there by reduced the leverage of the shareholders of waddy lake in half even though they got a stack in GNU.For more details refer to Canada Stock Watch New Bullietins form Jan 01/95---Jan 10/96......Now here is my concer n with Tyler: If GNU takes over, what will the shareholder of Tyler get in return. Since Golden Rule is trading at 12.00 ( Is this price justified?) will they offer the shareholders of Tyler 1 new share of GNU for every 20 Tyler. Since Tyler is trading at .60 and they don't move the stock higher,well you tell me what the implications are,it is obvious...If you have 20000 of Tyler and this hypathetical scenario is played out , then you would get 1000 shares of GNU. Same value ,but no Leverage..In order to double your money on GNU it will have to go 24.00.(could be alot of resistence) Look at it this way, for every 1000 shares you have,if it goes up .10 that is $100 gain.(Less cimmissions) If you have 20000 shares and goes up .10 your gain is 2000.00.........Now if you have 1000 shares of GNU and it goes up $1.00 your gain is $1000.00...but if you put a value on Tyler (which I am not sure) and the stock rises to say $1.00 and you hold 20000 shares and your purchase price is ,say,.60 . Your gain is $8000 . ( $1.00 -.60 = .40 x20000 shares ) Are you prepared to purhase the required number of shares of GNU (12.00 per share) to make that kind of profit or move onto some other play with more certainty...I am not suggesting that the stocks will rise in either case , but it is one possible way of looking at it........and perhaps there are many more..I just don't like the price of GNU (12.00) as opposed to Tyler (60) . It's all a numbers game and which ever way you look at it ,who can really tell. I can appreciate this is sketchy information but think of the possibility of holding more shares than the reduced amount..You do not make good money by holding small volumes.........Is it easier to move a penny stock on a percentage basis than a 12.00 stock......You tell me.....To me this is a method that is used by alot of companies when they roll back their stock (Consolidate i.e. 5 for 1) This has a negative effect on the leverage you have to make better money.........So as a result are you going to be enticed to buy more stock of GNU to increase your leverage at the current price of 12.00 on GNU???????? (Is the insider selling to the public, Nobody knows for sure, but I will take a guess......MORE THAN LIKELY)......IMPORTANT: Who is selling their stock at these price levels and who is buying at these levels of $12.00.( The public or the Pros) ?.Well I don't know what the stock options of the exe's and directors of GNU are , this is something that I would question!!!!!!!!! Are the insiders and pros selling at these lofty levels.?.......You ask yourself the question..................Good Dayyyyyyyyyyyyyyyyyyy....Ronald P.S. I can appreciate that the continuity of this message is some disjointed , but a difficult subject for a novice such as myself to communicate..Sorry, Hope I have been of some help............View this scenario with an open mind for it is only hypathetical, but it does happen in the real world, more often than most people realize........ |
