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Thursday, April 28, 2005 9:29:44 AM
well, from the companies vantage point, what's the real downside of having extra shares.......
The downside is in the perception of the potential investor.
Here is a company that has just reduced the potential ownership share of it's original investors by a factor of 10 to 20 but still has the ability to run the share count out to it's previous size. The result of which, could bring the share price back to it's pre-split value.
Why would an investor not consider such a risk? Given the history of the company to date, why wouldn't he consider the possibility that the company will use the shares?
It would look much more reasonable to the potential investor if he knew his ownership share was protected to some degree by a limited A/S and the knowledge that it could not increase without his participation in a vote.
regards,
frog
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