Trans Global Group Inc (TGGI)

[mdimport]

I've seen the R/S occur where everything is proportional. O/S, Preferred and A/S all reduce by the same amount. Then the company does as you say: support the bid price for 6 months so the market cap remains the same post split as it did pre-split, shareholders who have been R/S feel comfortable that they're not being dumped on and no-one loses ($1k invested pre-split = $1k invested post-split). Those are R/S's which are typically associated with a tidying up of share structure and up-list to a higher trading exchange.

If post-split the company was able to follow through with a series of closed deals that have revenue and no dilution with those PR's it may bring trading demand back. Again one of the typical reasons for filings post split is to dump on shareholders.

There are two issues you raised:
If the company wants to keep growing through acquisitions it needs more value or it will wind up giving away more equity then it needs to.
---> $10k equity deal is a $10k equity deal whether its at $0.01 or $0.0001. Basically immaterial.

Furthermore the biggest obstacle is Debt as we all know the debt is not affected in a R/S which is why the O/S bloats out again. This is where the company and the Debt holder need to negotiate a way to ensure post split the Debt doesn't bloat the O/S back again.
---> this would require the debt holders to work in the broad interest if the company. It may be different where a company is generating revenues such as TGGI, rather than one where there are no revenues WGA*. Also would be a matter for the debt holders to consider if they held significant equity.

All issues that needs to be discussed between management and the debt holders and then a lot of hand holding between management and shareholders (Common and Preferred).