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I don't think it'll matter though, I havent seen one yet reedem and make the warrants effective the same exact day...I dont even know if technically they are allowed to do it. CCME gave you a month.
So really if it stays above $8.50 for 17 of the next 27 trading days..and they do decide to call it in for redemption, they will give you plenty of time to sell the warrants IMO. And if they do reedem at $8.50 correct me if I'm wrong, but the fair value of the warrant should be about $3.50...so if that's the case I'd expect the warrant prices to move to around $3 from here
Actually CCME did not register and redeem same day....holders had a month to sell out of their warrants....
http://finance.yahoo.com/news/China-MediaExpress-Holdings-bw-1274750590.html?x=0&.v=1
If they can hold common above $8.50 for 20 out of 30 days....which so far its 3 in a row...you're right why wouldnt they redeem them. They may just be planning on doing that, and keeping fairly quiet while supporting the common price.
Can you explain the impact of the "cashless" option...I don't really understand it even after reading the excerpt below. What I want to know is what is the exact process and don't we have time to sell the warrants before redeeming, I know with CCME they announced it but you still had some time.
CS China’s management’s ability to require holders of its warrants to exercise such warrants on a cashless basis will cause holders to receive fewer ordinary shares upon their exercise of the warrants than they would have received had they been able to exercise their warrants for cash.
If CS China calls its warrants for redemption after the redemption criteria described in the prospectus for CS China’s IPO have been satisfied, CS China’s management will have the option to require any holder that wishes to exercise his warrant to do so on a “cashless basis.” If CS China’s management chooses to require holders to exercise their warrants on a cashless basis, the number of ordinary shares received by a holder upon exercise will be fewer than it would have been had such holder exercised his warrant for cash. This will have the effect of reducing the potential “upside” of the holder’s investment in CS China.
Basically, I may be wrong, but they have the option to redeem the warrants if the share price stays above $8.50 for 20 trading days out of a 30 day trading period. If that's the case I think what happens is that the warrants will be redeemed for $8.50-$5=$3.50
I could be wrong though, never went through the redemption process before. Please someone correct me if I'm wrong.
The key is when are these warrants going to be registered...because thats when they should absolutely fly
As long as they don't have any plans for a big secondary IPO type offering like CO (china cord) did...then I dont see why the warrants should lag this much.
China cord's common stock was in the $9's and warrants around this price...but at the same time there was a prospectus for an underwriter to do a secondary offering in the $5's or $6's I cant remember.
I dont see that in the filings here, but correct me if im wrong
I mean not much volume in the common, but I don't think it's painting...the person pushing it up who would be "painting" would have put in over $100k on the commons now...doesn't make sense to me.
The warrants are at a standstill, I would like to believe something is going on such as warrant exchange between institutions or aercf buying back some warrants, I really have no clue.
The warrants wont make a big move until its registered with SEC so you can exercise them. I emailed IR about it and they gave generic response that there have been no announcement made regarding registering warrants with SEC
I have a legal question regarding the registration of the warrants. I asked IR if there has been any announcements regarding registering them and he said there has been no announcements. Obviously the warrants are trading so below intrinsic value because until they are registered you can't exercise them. Now, legally how long does a company have to send in the registration form to make the warrants effective?
Because you'd think legally they'd have to make them effective at some point, otherwise if you can't ever exercise a warrant, they are pretty much worthless. So does anyone know what the SEC rules are regarding this?
The Roth Conference will be great exposure and may set off a run in the common and warrants, it still doesn't make sense that the warrants are lagging this much.
March 15-17 is the conference and looks like this conference is pretty legit, given they have one on one meeting as well, and many of the participants are fairly established companies in the small cap market.
http://www.meetmax.com/sched/rcp310/~public/conference_companies.html?event_id=4890
Thanks, but what are your thoughts on the potential negative shareholder equity and book value? Isn't that a little weird with positive net income and cash flows...yeah they may have no debt..but their liabilities are greater than their assets. Weird.
Anyways i am pretty heavy invested into the warrants at $1.30 but I must say its important to look at common just to see if the price will hold.
I just loaded up so more....so much time here "Each unit consists of one ordinary share of the Company’s stock and two Redeemable Ordinary Share Purchase Warrants (“Warrants”). Each Warrant entitles the holder to purchase from the Company one ordinary share at an exercise price of $5.00 commencing the later of the completion of a Business Combination or August 11, 2009 and expiring August 10, 2013."
Have until 2013...warrants at $5 strike..meaning common stock fair value at warrant current price would be $6.30....unless a disaster happens the company should trade above $6.30 at some point up until August of 2013 when the warrants are exercisable so that there wont be any fair value arbitrage
Seems like a no brainer here.
But can you comment on what seems to be negative book and shareholder equity value?
I'm thinking this is some warrant exchange between institutions but I can't be sure, not really sure how we're getting so much volume here at $1.30 and no price changes...although there was a block over 500k...I'm going to load up I think when they finally let it go off of $1.30
Wake up boys, basically 700k warrants exchanged so far at $1.30 while common up 6%...not sure what's going on
I think it's important we analayze the fundamentals here.
Am I missing something here with this? It appears that they have negative shareholder equity wiht 7million in assets and 9mill in liabilities? Am I reading it wrong? http://www.otcmarkets.com/pink/quote/quote.jsp?symbol=aercf#getFilings
Operating cash flow for 2009 has been pretty good at 9million
Book value is -.21 for AGRL as of september 09?
According to credit suisse buying 9.4% and has 650k shares or so, the O/S at this time must be around 7 million no?
But according to here http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=6898359 investor slide 6 says that upon closing CS china will be issuing 10.35 million shares, so I may be incorrect but that means there should be 17million shares O/S soon.
Another 4 million will be issued it seems in 2010,no reason stated, from the same slide.
There is 14.6 million warrants outstanding
So shortly there should be about 31million fully diluted (includes warrant) and at end of 2010 about 35million fully diluted, that's assuming they don't hit their net income incentives.
In 2010, if they hit 41million in net income, then another 12 million will be issued which would bring the fully diluted O/S to around 47 million. About .87 EPS fully diluted.
In the presentation of valuation the company uses a different fully diluted number than I do to calculate EPS, and they classify my estimates as gross shares. But to me I think full warrant dilution is necessary just to be conservative.
The one thing that concerns me is I really cant find a detailed balance sheet at all and that negative book value isnt making me too excited. Still there should be some value in the warrants, but looking for some follow up up responses here
That is a good point, any help?
Hey edj,
Have you done a fully diluting incentive + warrants analysis?
I havent had time, but I'd like to shortly. I wonder what EPS is when you dilute the whole O/S, as they have crazy incentive issuings IMO.
Has anyone confirmed that these shares will not be cancelled and new shares reissued?
Correct me if I'm wrong but CEM did file chap 11 for their american operations and not their overseas operation, isn't that the same case here with champion? Also, assets-liabilities=shareholder equity there is 55mill according to the filings, there should be more than 10mill left in the end I'd think.
If Shareholder Equity is $55million, lets just say for the heck of it, this isnt right, but lets say all legal costs etc cut the equity in half, still looking at around .30 share price.
Any financial information on this company coming in? Couldn't find anything.
Your post is very non specific and very "general". Seems to me like you are trying to promote fear. People that are "interested" in this venture, how would they know anything regarding what's happening.
About to be in breakout mode
So can you tell us what your revenue projections are?
What are sales estimates?
Rapid Increase of Outstanding Share Question:
Does it not concern anyone that in March 09 there was 47mill O/S
http://www.sec.gov/Archives/edgar/data/1331612/000105291809000130/fhp10qmar1709.htm
And in September 09 there is almost double the O/S at 82mill
http://www.sec.gov/Archives/edgar/data/1331612/000105291809000130/fhp10qmar1709.htm
82million is still low overall...but why are they increasing O/S at such a rapid rate?
This thing moves with such ease that it can probably make a monster run on news..the best part is this is fairly unknown, so not a lot of selling pressure from bagholders
Shareholder equity is .37 per share. What do you think....
Gap and run it looks like, key is shareholder equity value is $20million I believe, with 53mill O/S. That's .37 in equity value alone.
What IHUB boards are you guys referring to that gave this alert and find other undervalued gems? If you could link me that would be great, I'm in this one at .21, a bit late...but I think I'll be just fine
Fernando you weren't a fan of HOL when it was mentioned at .30 but you are now at $1.50?
Notice with these Spac warrants there usually seems like a huge supply at certain points, then it makes huge moves after. Like HOL/WS was stuck at .40-.50 for a long long time, then it just took off like crazy. Usually there the next day are follow through plays just like today follow through from the move to .80. I expect to see about $1.50 tomorrow, but depends on how it trades with the IPO, if we are in the mid $7's intrinsic is $2.50
Nice find, good to have them present there and also confirms it starts trading tomorrow, added some here.
Huge spreads on this one...my level II must not be working for this one as it just always shows 25 blocks on both sides and don't see any individualized bidders.
sorry that's what I mean, EPS to hold up the price..we will see, I like it because of the intrinsic value, and this volume has to be more than just the few of us watching, so someone else sees an opportunity as well
Only thing I'm not a big fan of is the financials... barely any net income.
definitely some familiar faces here :)
I think these warrants will really pop once it gets listed, no one knows about this yet...when its a nyse stock, people will take notice.
Thanks, taking starter position here.
I like it but if their offering price is way below $9-$12, I recall you or someone else saying more like $5-$6..doesn't this change the ballgame?
Looks like you made a great call, getting demolished here with entry in $11's and high $8's, still guidance at $1.30 EPS this year and most likely going to increase, I'll wait and hold, as this should be/could be a $15+ stock