The pps is clearly heading up.
It should be obvious to everyone that the pps will quickly start to recover and start spiking and trending upward in rather dramatic fashion. Why? A few reasons.
First, and most importantly the immediate purchase of the massive share offering makes it abundantly clear that institutional buyers purchased the 4.94 million plus 740k over-allotment of shares and warrants.
Second, the details of the offer indicate institutional and wealthy investors obviously feel the pps is heading back north of $5.25 per share. Five dollars and twenty-five cents is the strike price of these warrants.
Since there is currently no public market for these warrants their value can only be realized when the pps rockets past $5.25 per share.
I know you are probably saying to yourself, well it is true that there is no current publicly traded market for the warrants but in the coming months if the pps is trading between 4.00-5.00 per share, underwriters on Wall Street will establish a market. True. The market would be thinly traded and subject to wild swings in price, more so than the option's market due to the relatively limited supply of these warrants, only 5 million.
But if you look at the secondary press release Dr. Bassam Damaj states: "There is no public market for these warrants and we do not expect one to develop." Why would he make such a bold statement?
The cynics and sceptics would say, "Of course he is going to say that. He does not want existing shareholders to worry about the buyers of units (share plus a warrant for $4.05) flipping the shares and the warrants for a quick profit. This would certainly be true if the warrant, conservatively valued at $1.20 per warrant, could be sold in a public market. Note: 3.65 for a share + 1.25 for the warrant = $4.90 per unit. Since they paid 4.05 for the unit, they would be making an immediate .85 per unit. Five million units x .85 = $4.25 million in immediate profits. Nobody could pass up that opportunity.
Okay, Dr Damaj might have a incentive to keep the pps from tanking and claim truthfully that there is currently no public market for warrants. However, the second part of the statement "and I do not expect a market to develop." Whoa, that puts him in legal jeopardy. Dr. Damaj knows darn well that a warrant market is extremely likely to develop on Wall Street over the next couple of months. Why would he expose himself and Apricus to such legal jeopardy? There is only one explanation, a market will not develop.
Holy smokes. That is it. A market will not develop. What would prevent a market from developing? What would prevent Wall Street underwriters from buying and selling these warrants? Do you see it now?
The only thing that will prevent a market from developing is an explosive rise in the pps. If the pps explodes past $5.25 existing warrant holders will exercise those warrants. That means they will sell the warrants back to Apricus for $5.25 per share. (Since warrants only allow the purchase of 1/2 share, the exercise price of the warrant = $2.625 per warrant.)
Dr. Damaj has just told existing shareholders, unit holders and shorts in very clear language that good news is coming soon and the pps is going to take off.
There was a time to sell this stock but now is the time to buy with both hands and then buy some more. Cheap shares will not last. Shorts, congratulations on your recent profits. You were right the price did tank. However, your time is done for now. GLTA.
