Replies to post #74241 on Muscle Pharm Corporation (MSLPQ)

[TheExpertHimself]

everybody has been doing this for the past 3 years.

Hotels are refinancing their mortgages paying out the money to partners and employees.

Public companies are issuing corporate bonds paying out the borrowed money to shareholders and employees.


When a company borrows money to pass it through to the owners, the equity goes down.....when the equity goes down it becomes more affordable to a potential buyer....but it also becomes less solvent....which means the company needs a buyer that will strike a deal for sure. This could explain why Capstone gave Musclepharm warrants for 20% of the company and an option to buy the remaining 80%.

[PanchoJimenz]

How do you Capstone's credit is better? You have access to their books and their credit rating?