Replies to post #30307 on Electronic Cigarettes International Group Ltd fka

[I-Glow]

In theory what the company stated is accurate but it rarely happens they way it is explained:

The company wrote:

The Company previously announced consideration of a reverse stock split. This action will not directly affect the Company’s market valuation nor the percentage of ECIG stock owned by each shareholder. [Example: in a 1-for-10 reverse split, each shareholder will own one-tenth the number of shares as previously, but at the time of the split each share is worth ten times the pre-split price.]

If ECIG is at 0.05 and it was 1:10 reverse split the price would have to be 0.50 for shareholders to retain the same value.

But, if they decide to do a 1:100 reverse split - the price will have to go to $5.00.

Going to $0.50 and holding is very unlikely.

Then management goes on to say:

To facilitate obtaining the long-term financing that the Company is currently pursuing, ECIG intends to execute a reverse stock split, but this action does not dilute shareholders.

I think reverse splits always causes dilution - as the A/S is unchanged each shareholders holds a smaller percentage of the company.

IG