Two homerun plays 2 weeks away...
We're now at the 2 week countdown point (2/12 being the big vote day) for two SPAC deals that are having shareholder votes.
The underlying symbols are AXG and CFQCF.OB, but the warrants are the play worth mentioning here on ZCC.
As of this post, AXG-WT = .28 and CFQWF.OB = 1.21
As mentioned, both votes happen to be occurring on 2/12, and I have high confidence (~90%) that both will go thru.
Scenario for AXG-WT: The terms of the deal are such that, at current price for AXG, the warrants should head towards their fair-value of about .62 if the vote is successful. If one does not sell his warrants, one will end up with a prorated portion of allocated stock in the new company (Select Staffing). That could end up being a good thing.
Scenario for CFQWF: These warrants are a play on the intrinsic value, but there are other subtle catalysts as well. At the trust-per-share price of $8, the CFQWF warrants have an intrinsic value (not considering the discount due to vote risk) of $3. So if the deal goes thru, the warrants should make up that vote risk and head straight towards intrinsic. That would be a move from $1.21 to ~$3. But there are similarities to this deal and CCME's deal, and the merger partner (China Wowjoint) looks to be a great acquisition. So the underlying post-merger shares of China Wowjoint could indeed trade higher than $8, and that would pull the warrants right along. Additionally, one of the sneaky catalysts is that the shares are on the .OB and so ultimately (per their filings), Wowjoint is going to uplist.
THE RISK FOR BOTH OF THESE: Even though I don't think either will be voted down, that possibility exists, and the warrants would almost surely end up near worthless.
Solid DD combined with timeliness and conviction is a recipe for profits.
AI
