Howdy everyone.......the issue of a consolidation is not all cut and dried in my opinion......
For a start, the investors with minimal shares probably can't even remember buying the shares in EGO
let alone have any idea what the company is doing, deceased estates,inheritances etc , in short they do
not take an active interest in the market, let alone EGO.....In no way am I suggesting that they don't bear consideration in company responsibility but it wouldn't matter to them whether they were in or out......
When a consolidation is brought up by the company it almost religiously comes with the explanation
that they want to attract instos and bigger investors into the fold.....Instos for example by their own rules
are not allowed to invest in penny stocks.......Indeed they could have restrictions that limit them (for arguments sake) at a MC of $30m or a SP of 30c.........BUT and a very big BUT is that they wont invest in a company simply because it meets their criteria.....
At this point in time a 50:1 consolidation, as suggested by Argonaut would get EGO to 30c.....
Sounds better than .06cpi but in all reality no better than that........
Which brings me to my point....The consolidation(I think we understand it has to happen) has to be at a time
when the instos etc can initially buy at 30c and expect the SP to go to 35c or 40c, i.e get a return on their investment......If they don't think it's worth buying it will be down to 20c in no time.....
The market is littered with corpses of companies which consolidated and failed.....
Picking the right time to consolidate is the boards responsibility and it is not a decision to be taken lightly...
Happy to be picked to pieces,just my view...
EGO Price at posting:
0.6¢ Sentiment: Buy Disclosure: Held
