Thursday, May 30, 2019 6:59:31 PM
Selling it back doesn't hurt the 20.1%. In fact it restores it back to 100%, at least before the inevitable secondary offering.
If the government sells 79.9% back to the company they have to borrow the funds for that, and pay interest, in 2008 the government and private holders got in this situation, the statuary rules of FHFA is to conserve (make the company sound and solvent again), by now we know they did the opposite, and siphoned all fund off to the government, and then taking a loan for the 79.9% from treasury, because they did not do their job, will hurt the other 20.1% share base, legal wise to execute this will be a no go for a government agency, upto now the government has done nothing wrong on the warrant part, ones executed the conservatorship becomes a taking pur sang
20.1% is not some magic number, either. I don't see how dilution to that point is fine but anything more isn't.
The legal battle between the 20.1% and 79.9% is been ongoing for years now, Dilution is fine but not as part to dilute the current 20.1 share base, they only received 79.9 % of the company so that is what can be diluted*, not more not less, and with light at the end of the tunnel in a way you can say 20.1 is the magic number
*or pay damages in cash or stock to the 20.1 holders
I disagree. Ending the NWS and extinguishing the seniors should be enough to get all the lawsuits dropped. There is enough to gain for the plaintiffs without holding out for these damages.
I agree if thru reverse accounting enough is paid back and the government process in the 12.000 document prove they did nothing wrong and all is in good faith then probably most will drop the suits, if the agreement is not satisfying way more will file new suits for unconstitutional reasons or other loose ends they might forgot they ever had
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