Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : KNGC; Kalan Gold Corporation - another metals player -- Ignore unavailable to you. Want to Upgrade?

To: KZAP who wrote (16)	6/12/1999 11:58:00 PM
From: TraderGreg	Read Replies (1) \| Respond to of 33

AEI, after being acquired, owns 87% of the O/S; the former management owns approx. 5%(which is restricted), approx. 5% will be distributed as part of the PP. That leaves 3 mm shares in the float, give or take. Now, look at the above numbers and consider this: AEI wants the National Listing, right? the former management wants the national listing, right? the PP recipient, Gilt Guaranty, wants the national listing, right? I would venture to guess that none of the above plan on selling a single share prior to getting the National listing. The PP will infuse cash into the company. So, what we have here is 97% of the shares locked up via 144 or future goals, and a 3% float representing approximately 3 mm shares. The $50mm PP will include a cash portion, originally slated at $20mm, but I am not sure what it is right now. Perhaps those cash funds may be used for an ESOP or similar employee benefit plan. Here is my point. EVEN IF EVERY CURRENT SHAREHOLDER IN THE FLOAT DECIDES TO BAIL, IT CANNOT POSSIBLY TAKE MORE THAN $15 MM TO EITHER A. BUY UP THE ENTIRE FLOAT OF 3 MM SHARES OR B. BUY UP ENOUGH OF THE FLOAT TO GET THE STOCK TO $5. If A. is accomplished, then the $5 stock price is achieved by virtue of the fact that all weak hands will have already sold and those buying want to keep it at $5. One would assume that those buying are relatively close to the company, but still detached enough to be part of the public float,e.g., employees and their family members but not management or directors. If B. is accomplished then the Company would have additional funds left over since the stock hit $5 before the float was bought up. Hence, funds would be left over to essentially support the $5 price. TG