Traders may be able to make a buck.
Long-term investors need to wait.
The good news may generate some volatility in market prices. Once the rights offering begins, I expect prices to start a decline.
Why?
Each shareholder will receive 15.335 rights to buy shares at $.20. Based on yesterday's close of $.835 per share, this equals a $.635 difference. This is a huge!
Traditionally, arbs sell shares short, exercise rights, deliver shares and take home a risk-free profit.
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