It depends also on if the Gov as it should, returns any illegally received Money and any Interests / Dividends Annually higher 2% as for any Banks by the Treasury provided ! At closer to release we can naturally also expect a much higher Stock Price than now and especially afterwards and by Relisting to NYSE or NASDAQ which all together gets a totally different mathematical calculation as presently possible !
Compare the risks involved with most probable failure of raising 100s of billions over a period of 2 to 5 years with fnf still under conservatorship against 100% sure way of recapitalizing fnf with retained earnings, risk sharing, right sizing the companies, revaluation reserves, raising fresh capital over a period of time and fnf can be released with the same or less risks.
If you go by Moelis plan, it values 80% gov warrants at $125B but it wants private investors to pay $100B for less than 20% cs equity. Another way to look at it is, if private investors are paying $100B for less than 20% cs equity then then gov should get $400B for 80% warrants. It makes no financial sense.
Gov made $150B profits on net investment of $150B and got 80% equity for free but worth another $125B. Why would private investors invest $100B for less than 20% of cs equity in zero net worth companies under more than 10 years of lawless conservatorship.
None of these makes any financial sense for any private investors.
Especially when Mark Calabria, FHFA director and one of the two most powerful players in this whole thing (Mnuchin is the other), said so himself! Multiple times!
Talk about how the recap should go is worthless. We know what will happen, which is a faster capital raise using sources other than retained earnings.