Fannie Mae-No Politics (FNMA)

[kthomp19]

So for $40,000 net proceeds to the company for excersizing the warrants and getting 80% of a 5 trillion dollar company for a tiny amount of money would not be challenged by shareholders?

Sure it could be challenged. But the challenges will result in maybe a dollar or two per share to the shareholders, because awards in takings lawsuits are only based on what the property owner lost, not what the government gains. The only quantifiable damages would be a drop in share price from the day before to the day of warrant exercise.

It is clear from the January letter agreement that neither Treasury nor the Department of Justice fear such challenges, so feel free to bluster away.

Ironically, Ackman wouldn't challenge warrant exercise. In fact, he wants Treasury to exercise the warrants because he correctly recognizes that having Treasury aligned with, instead of being opposed to, his interests is a good thing.

The "5 trillion dollar company" is hyperbole anyway. FnF's total book equity right now is around $49B and if the seniors were to go away $33B of that would belong to the juniors. Treasury's 79.9% of the remaining $16B would only be worth $13B or so. Just what they were valued at in Biden's FY 2022 budget, coincidentally.

Here’s a hint..the warrants and warrant price do not conform with rules associated to issuing those warrants.

How so? The answer should be in the warrant document I linked to, so give me the section and page numbers that support your argument.