Replies to post #706590 on Fannie Mae-No Politics (FNMA)

[bradford86]

let me put some math down for you. since you don't seem to understand how this works.

with spspa and warrants, spspa could convert to common and dilute at these prices say ---

The aggregate liquidation preference of the senior preferred stock increased to $158.8 billion as of September 30, 2021
and will further increase to $163.7 billion as of December 31, 2021 due to the $4.8 billion increase in our net worth
during the third quarter of 2021.

freddie mac's liquidation preference is $95B

so if you combine them for numbers.. $250B

convert to common at $1~ 250B more common shares.

then you exercise the warrants 80% dilution, you're at like 1250B shares combined for fannie and freddie.

then you reverse split like 200:1

6.25B shares pre-ipo and $25B of earnings and $100B capital raise on a $200B-$250B valuation.

so like 12B shares post restructuring. EPS of $2. price of about $20

government's stake worth about $70-100B

existing common effectively reverse split 200:1 and trades at $20. or $0.10 of today's price

this is a spspa liquidation preference conversion scenario.