Fannie Mae (FNMA)

[KevinLM]

As long as the SPS and the warrants exist, I think there is no way of FnF going public at all. Your idea that the warrants could be exercised a few years after the IPO seems unrealistic. The subscribers to the new shares want clear conditions already at the time of the IPO so that they can calculate reasonably.

Totally agree. They would have to cancel the SPS at the very least. If they convert it to commons I dont think any significant new money would be coming in. We are looking at a USD 100B or more raise. That is really an absurd amount of new money for practically a government owned company.

Thats why I think the government relist it by cancelling the Seniors and relist while the warrants are valid with a backstop from the government until they build enough core capital.

The rights to the warrants can be sold. The warrants can still be exercised post IPO, the governments can sell the rights to the warrants based on the current share price with a discount. No new money is needed as government will backstop until core capital is adequate thru retained earnings. The government will make off with the value of their warrants.

This I think is the best the government can hope for. Unfortunately time is not on their side, I feel the court cases will torpedo any IPO chances. They are running out of time.