Consolidating shares does sweet nothing for the company. Market cap stays the same, the problems of lack of revenue and negative cash flow remain. This does nothing to address any issues the company is facing. I am totally perplexed.
1. There cannot be good news, because under the continuous disclosure laws they would have to inform the market before entering into this buy back.
2. It punches a hole in the available cash, reduces them to around 3 quarters.
3. It further concentrates ownership, can guranetee that Phillips and Meng will not sell shares into the offer.
I think the only logical thing is they are going private or something of that note as it gives the larger shareholders a bigger percentage for an vote.
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