I was thinking it’s a fairly brave investment by Magna given the company’s dim prospects and ridiculously high market cap in proportion, plus the low likelihood of them being in a position to redeem the notes.
Very cynical way to make money.
Effectively providing the IV drip to keep a dying carcass alive while feeding off the investors still throwing money into it. And on the plus side for them if the company recovers they still make money anyway.
Only risk they have to mitigate against is bad management not managing the funding drip and letting it go into cardiac arrest.
Pretty much guaranteed they’ll be converting and feeding out their discounted stock by the looks of it.
There’s no hope they’ll see the redemption occur IMO - unless they do another CR to fund the redemption of the con notes - which would be a bit like taking out a new credit card to pay off the old credit card (while still paying off the credit card from CRH at the same time)
To me the way they’re operating is pretty ordinary form and no one involved seems to care that retail investors are naively over committing vs risk profile into this stock.
Men in grey suits a.k.a. sharks feeding is the vision that comes to mind.
OGX Price at posting:
4.3¢ Sentiment: None Disclosure: Not Held
