FFX presumably has to first purchase shares from Leo to then “give them away” to us in specie, yes?
So how about something like this (totally hypothetical):
For $9,271,082 FFX last week purchased 4,635,541 shares nominally worth $2.00.
Leo then resolves to do a stock split of 1:40 for ASX listing purposes meaning FFX now owns 185,421,640 shares nominally worth $0.05 (i.e. 5 cents each, same original cost of $9,271,082).
FFX resolves to retain ~20% of its Leo shares as an investment and distribute the ~80% balance pro rata to holders of its own securities.
FFX decides that FFX holders will receive 1 LLL share for every parcel of 8 FFX shares they hold. It is an in-specie transfer (the actual share is transferred not the original cash price paid for it).
With respect to FFX shareholders, FFX has 1,178,136,200 quoted securities and another 11,043,000 unquoted securities as at today’s date. That is total issued securities of 1,189,179,200 or (divided by 8) 148,647,400 parcels of 8 FFX shares.
So FFX distributes 148,647,400 LLL shares to FFX holders (= 80.17 % of its original holding in Leo) and retains 36,774,240 LLL shares (= 19.83% of its original holding in Leo).
The LLL board then prices it’s planned entitlement offer. Maybe it offers an additional 64,578,360, bringing LLL up to 250,000,000 shares on issue at listing date (if fully subscribed of course). In doing so it effectively sets the value of all shares on listing day at whatever it prices those additional entitlement shares at ($1? $2?). The market then takes over.
Just random weekend musings. Feel free to tear apart or disregard We’ll presumably know for certain soon anyhow.
We’ll presumably know for certain soon anyhow.
