newtech, I have to agree with the comment made by secolton on this. When this many shares move and there is price stability around the 60 cents level, I think we have a pre-arranged sale here that was well-orchestrated. And, we should be looking for more of this to come in the days ahead. I don't think this type of buying and selling is over.
Typically, under pre-arranged sales agreements, a certain number of shares are moved, but with an attempt to maintain share stability. On Thursday's trading, maybe over 1 million shares was pre-arranged, but look how stable the share price was.
So, the next questions: Who is the seller and who is the buyer. My guess is that the seller is one of the top 5 shareholders that is trying to take some big profits with the unknown future of what the EC will achieve, just to be safe. The top holders of this stock were buying up many shares at below 10 cents per share and they were buying even before Tronox declared bankruptcy. So, some big profits were already made.
The buyer? My guess would be a strategic interest who has future intention to acquire some of the assets or the entire Tronox company when it is up for sale in the future...........and Tronox will be up for sale in the future IMO, when the proper asset value can be achieved.
Certainly, buying up the shares at 60 cents may be a much better deal than buying out shareholders at a future date when the stock is at a much higher price level.
So, who would potential strategic buying interests be? In my opinion, Cristal Global, Huntsman and maybe Kronos. Other non-strategic buyers such as private equity players may also be making the this play.
Good news is that more and more parties understand the real value of the remaining assets of Tronox. Let's hope the share price in the days and weeks ahead starts to reflect this. But until we get more information regarding the EC plan, we may be stuck in a trading zone.
The only risk going forward is not knowing what shareholders will be left with in the days ahead, however, as you have noted, our outlook is much better than it was a couple of months ago!
Best regards to all.
