Under the current capital structure, it is unlikely that SKRRF will be "in the money" from a book-value perspective for some time. It is currently some $550 million away from there, and it is difficult to see how such a significant amount of money will ever be made out of operating earnings (if any). Significant additional write-ups are also unlikely, IMO. As such, the only way the common is likely to see any value is either:
i) when the convertible preferred converts automatically (in six-year's time), at which point there will be aproximately a $1 value per share on a book-value basis; or,
ii) if CC/MM decide they want to sell and/or restructure in order to have a stronger balance sheet, at which point whatever gets accepted by the majority of shareholders, or the independent members of the board, is likely to be the final value. My best guess at this point is about $0.50.
In any of the above cases there is clearly significat updise, the question is when. Even 50 cts in a couple of years is a decent-enough return.
Obviously the above analysis can prove to be wrong, but I haven't seen anything better being posted.
Any comments welcome.
