Mook, I agree with the sentiments of that article, however that...

Mook,

I agree with the sentiments of that article, however that article refers to Virgin issuing new shares that they would create at that time. These would then be 'offered' to Etihad at the current market rate. This means that the revenue (cash) derived from those share sales would go directly to Virgin and end up on the Virgin balance sheet, from where Virgin could use it for any purpose - such as buying new aeroplanes, paying down debt, banking it, or even give some of it away to existing Virgin Shareholders as a 'Dividend'.

These 'new' shares would then be in addition to the 2.2 billion already on issue. This can therefore possibly have the effect of diluting the value of the shares on issue, because if say Virgin were to 'place'300 million shares with Etihad at .40 cents, it would generate revenue of $120 million cash, but there would then be 2.5 billion shares on issue, and the stockmarket may view that unfavourably. So there are pros and cons.

Conversely if Etihad were to just buy 300 million shares at 40 cents each through the normal markets, then Virgin would get no net benefit financially, as the shares would be bought off ordinary share holders such as us. Although, there would also be a closer brotherhood of having Etihad on their share register - and any likely board influence etc. Obviously in that scenario there would be no increase of the number of shares on issue.

I note that 30 million shares have now sold in the past few days, I suspect that international share houses are buying up parcels for their portfolios, since now anyone in the world can buy VAH.

But as they are doing so on the QT it is going unnoticed to the sellers and day traders and the demand is not being recognised for what it is.

There are only a terminal number of VAH shares for sale on the open market as most are tied up with institutional buyers. Such is it that when the demand starts to dry up then price pressure may be recognised by local traders and the share price should rise.

This share is still woefully underpriced in my opinion and must be due for a big jump soon, rather than the pathetic one cent increments it's been making in the past year.

But then I could be wrong eh!!! (LOL) I just like to remember that with stocks, as with any commodity, Supply and Demand dictate price...

Good Luck...