Always happy to have an offline chat about STX
But for the purpose of transparency for this discussion at least, I think it's beneficial for the entire board to try and get on the same page. As I have previously stated, I think it is quite possible Hancock or any interested party may take advantage of the depressed price action to accumulate a large position in STX. I get the general gist behind the various theories - all centered around a big bad predator working with unnamed dark underbelly faces of the market to short sell STX (and any other stocks that people are losing money in) into oblivions while the predator accumulates.
What I want to understand is the following list of assertions:
(1) Hancock is working with or has hired the shorters to help accumulate a large stake by suppressing the SP. Ok, so this is true, Hancock will be paying the shorters for any potential losses incurred because no one is stupid enough to short on behalf of someone else and agree to wear all the losses. Say this is true. So Hancock successfully spent tens of millions short selling the hell out of STX and in the process, accumulates a net position of -10% (all the short sold stocks are done for Hancock). Hancock then uses this as a starting point to launch a bid of say 22c (30% premium) and the board flat out rejects it. All Hancock has done is to accumulate a net position of -10% via the short (which they will have to cover eventually) and have nothing to show for it.
(2) Hancock is NOT working with the shorts, but has conspired with the lenders (ie. the index funds) for them to sell those holdings to Hancock. I wouldn't agree with the any index funds working WITH Hancock. But if and when the index funds want to exit its STX position, they will put those stakes in a block trade auction process and whoever puts in the highest bid will win, which may be Hancock or the shorters. If Hancock does take those index fund positions, then as I said in my other post, the shorters will either have to cover on market (and likely cause a massive short squeeze), or maintain their short position for longer waiting for a bad news event that will allow them to exit profitably. This is no mean feat given the short position is over 300mn shares, which will take many many days to cover on market.
(3) The shorted position of 10% magically ends up with Hancock having 20% substantial position. How is it even mathematically possible to go from -10 to +20 without any buying (which in this case needs to be +30)? Simply put, Short interest = 10% (which is -10% in holding term). To get from -10% to actual holding of 20%, Hancock will need to buy 30% because simple laws of basic arithmetic dictates that -10+30=20.
618
(20min delay)