Hoping to achieve large gains is the gambling component, up to 15c we have a solid investment case.
RIM has not backed off, that means they are prepared to win (unlikely but in theory possible) and bear the consequences of their win.
1. RIM candidates are the worse choice, not necessarily because they are bad, the candidates are just the wrong guys for running Troy in its current state (small exploring miner). And the wrong guys for running the Karouni mine.
2. If they win they will lose nearly all key personnel.
3. They will face tougher financial conditions with probably losing the loan.
And despite that not retracting their proposals.
Could it be they are not interested in Karouni but in Troy as a corporate entity? Do not forget there are huge losses carried forward, 30% of which can be recovered in tax savings if cash flow sets in. So is RIM positioning candidates for running something else?
That would imply RIM is unlikely to sell their shares after they lose. As long as they have more than 5% they can make new proposals.
Maybe the corporate transaction Troy referred to is not selling the remaining 30% of Casposo but an arrangement with RIM? Essentially turning the tax value of carried losses into cash?
That would mean if RIM wins shareholders get the tax value of carried losses (quite large) plus price paid for Karouni in a fire-sale.
If Jones wins and there is an arrangement shareholders would get a fully operational Karouni with a solid balance sheet but without the value of carried losses.
The market seems to think if RIM wins financial calamity will follow (making a huge CR necessary) and if Jones wins RIM will sell shares = lower share price. Whatever the outcome of the meeting, both scenarios will turn out way better than that, if my understanding of RIM's motives is correct.
