AI
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Saturday, June 21, 2008 4:14:31 PM
Thwarted takeover???
Brikk: I'm thinking that this Friday's action was more significant than a mere margin call scenario, nor was it a standard m/m shake. Over one million shares were traded and most of them at $1.00. The daily chart is quite remarkable (see below). Personally I have never seen one look like that where it plummets vertically and flattens as straight as a table top.
It appears to me that there was no coincidence between the price action and the poison pill disclosure. The most plausible explanation in my mind, after pondering it for many hours, is that there was some entity that was in the process of building up a large position in an incipient plan to launch a takeover attempt. Management apparently got wind of it and took the emergent steps which we learned about yesterday, i.e. changes in by-laws and creation of the new class of preferreds. Once this became known to the acquiring entity, they evidently lost interest in holding a large position in DPDW and sold. It was clear that they sold with a limit of $1.00 and the price quickly went to that level. It is possible that another entity, perhaps individuals or institutions close to current DPDW management, moved quickly to absorb those shares and hence the large volume. I suspect that there may be more selling next week since it is likely that the thwarted entity's position was larger than a million shares, but we'll see soon enough.
Interesting turn of events. Since you have had some contact with Mr. Chamberlain perhaps he would be amenable to clarifying this for us?
Good luck!
-Fritz
Brikk: I'm thinking that this Friday's action was more significant than a mere margin call scenario, nor was it a standard m/m shake. Over one million shares were traded and most of them at $1.00. The daily chart is quite remarkable (see below). Personally I have never seen one look like that where it plummets vertically and flattens as straight as a table top.
It appears to me that there was no coincidence between the price action and the poison pill disclosure. The most plausible explanation in my mind, after pondering it for many hours, is that there was some entity that was in the process of building up a large position in an incipient plan to launch a takeover attempt. Management apparently got wind of it and took the emergent steps which we learned about yesterday, i.e. changes in by-laws and creation of the new class of preferreds. Once this became known to the acquiring entity, they evidently lost interest in holding a large position in DPDW and sold. It was clear that they sold with a limit of $1.00 and the price quickly went to that level. It is possible that another entity, perhaps individuals or institutions close to current DPDW management, moved quickly to absorb those shares and hence the large volume. I suspect that there may be more selling next week since it is likely that the thwarted entity's position was larger than a million shares, but we'll see soon enough.
Interesting turn of events. Since you have had some contact with Mr. Chamberlain perhaps he would be amenable to clarifying this for us?
Good luck!
-Fritz
The more you know, the less you don't know.
