From my understanding, which is limited.The shares that the...

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astro boy

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30/01/20

16:36

Post #: 42650146
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Originally posted by Darkstone: ↑

This strikes me as very unusual. Why would the lender pass voting over to a shorter notionally undermining their stock value, just for a lending fee? And why would CS want voting rights in the first place? I presume they had to pay more for that. Something is very wrong here. Better pay attention to exactly how much they are accumulating I think. There aren't too many reasons why you would want voting rights for a stock you were theoretically only holding for the purposes of selling for a short time. Once they have sold the stock they don't own it any more so the voting rights are gone with the stock.

I can see that if you don't have to worry about the lender's voting rights, then you don't have to buy the stock back to return to the original lender, or to exercise the votes on behalf of the original lender when a vote arises. Since dividends are not expected in the near future you won't need to worry about that either, so acquiring the voting rights in the transaction would mean you don't have the pressure to reacquire the shares before the AGM, or a takeover vote, etc. It also means that if you haven't sold them you can influence the BOD, vote in favour of a CR, etc. Get enough without selling and you might even claim a board seat. I guess.

The lender's motivation is less clear because it would seem they are giving up their primary value safeguard, which is that the borrower can't influence the capital structure or direction of the company directly.

Very, very odd. My spidey senses have gone all tingly.

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From my understanding, which is limited.
The shares that the lender in question, would have been purchased at a very low price in major volume'
Does this alter your questioning at all ?

GXY Price at posting: $1.02 Sentiment: Buy Disclosure: Held
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