Friday, October 05, 2007 8:28:59 PM
shares on the float by selling shares to new people.
Well, that would be bad for current shareholders because
he would be diluting the current number of shares
outstanding. You see, the fewer number of shares
outstanding a company has the better value those
shares have.
He already tried that once by issuing the 1 for 2
bonus shares and then ended up doing the 3 for 1
reverse split. It is a gimmick and gives the company
a bad reputation. For example, I now have fewer shares
than when I originally invested in the company because
he took away 1/3rd of my shares with the 3 for 1
reverse split. He continues to sell shares even after
the reverse split which is very poor business practice.
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