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2.6¢ ardent resources ltd

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MellowYellow

1,957 Posts.

125

07/12/15

20:26

Post #: 16564185
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Originally posted by jordantravispyne ↑

Oh I see your concern now. This is interesting and novel.

Generally a 2 for 1 consolidation would see the number of shares on issue halve and the price double. So without the deal (looking in isolation), a 2 for 1 consolidation would see the share price rise to 4.6c and the number of shares halve leaving the market cap (and value for original holders) unchanged.

But you are saying that the number of shares will halve without the current price rising due to the market already accounting for consolidation.

This deal just became very difficult to value.

The share price will definitely rise as the institutional investors paid $0.032 for their shares that will not be consolidated. It is just a matter of whether the price will rise enough to offset the consolidation for existing holders as the market may have already factored this in given the nature of the deal.

Very interesting.

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Yeah that is what I was getting at mate.
I just think it is poor form that current holders get their shares consolidated. There aren't that many on issue compared to the number that the vendors will be issues afterwards.....
Anyway......I like the business but I'll wait till the dust settles before buying in........

AWO Price at posting: 2.3¢ Sentiment: None Disclosure: Not Held
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