A friend who own BSR has asked me to explain the rights+option stuff to him and I am trying to wrap my mind around it.
The basics are fine. Pay 1.7 cents now, get a share plus an option on another share at 3.4 cents until Sep'19.
But how does this translate to value?
Assuming the option is exercised, then a holder would be paying 5.1 cents for two shares (2.55 cents each) to preserve a 2:8 dilution. I have this nagging feeling that the SP would need to hit 4 cents-ish to be a win.
An alternative play would be to spend the money now and buy 3 shares on the market at 1.7 cents (or less).
We are both confused...
BSR Price at posting:
1.6¢ Sentiment: None Disclosure: Not Held
