If the options are tradable at say 0.2c then those partaking in the CR will effectively get their new shares at 0.8c. If sold immediately for say 1.2c then they have a 50% profit, for a 3/4 week at risk period. To a trader this is a huge win.
If confident of a 1.2c SP, then they can buy 1m (or whatever volume they need to make the deal worthwhile) shares at current price of 1.4c, do the deal, sell out and still be in front by a reasonable % margin on the whole deal. This is easy money.
What could go wrong? The SP may not trade above 1c, killing the trade.
I can see the SP fluctuating around 1 to 1.2c going into the CR, and for some time until the traders have exited.
OSL Price at posting:
1.4¢ Sentiment: None Disclosure: Not Held
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