The reason that commons get cancelled in 99% of bk cases is because the debtor is unable to satisfy their creditors at 100 cents on the dollar and their assets are less than their liabilities. To satisfy their debt, the old stock is cancelled and new stock is issued.
WMI is not in bk because they couldn't pay their creditors. Right now their assets = their liabilities, and this is without their assets valued at market value. They are all valued at the original book value. In addition, WMI has about 20+ billion in NOLs which they can carry forward or back (I believe they will carry back to get money back from IRS), NUBIL, and capital losses, which will result in a significant refund, and they also have a ton of subsidiaries that are currently operating and add value to the company (which are all valued at original investment book value).
In addition, there are about 1.7 b shares outstanding, but there are 3 billion shares authorized, which means that even if they couldn't satisfy their creditors (which I feel they will be able to, especially after their money they get from the FDIC), I don't feel there would be a need to issue new paper as there are currently 1.3 billion shares authorized but not issued.
My subscription to www.secinfo.com has expired, but I would suggest doing some research on the company to familiarize yourself with their
It is indeed true that in almost every bk case the commons get cancelled, and that is because most companies go into bk because they can't pay their creditors. As I've said, WMI is not in bk because they couldn't pay their creditors. They are in bk because their banks were stolen. It appears from the court docs that the noteholders, bondholders, and other creditors are working with WMI and fully support them in their suit against the FDIC, which is a no-brainer.
Don't invest what you aren't willing to lose in its entirety, but it is my firm belief that this has never been your average bankruptcy and will not end like one.
I am going to Madison for the next 2 days and won't be posting, so if I don't respond it isn't because I am ignoring you, it will be because I am not at my computer.
Those are very valid questions, but also, don't forget that if someone wants to buy them out , it doesn't matter if there is an A, B , C, or Q at the end of the symbol.
Hope this helps.
I'd say good luck, but this has nothing to do with luck.