Replies to post #111045 on Wave Systems Corp. (fka WAVXQ)

[cmf]

cosmo:

The buyout premium is based on and relative to current share price. Not market cap per se.

Your stake in the company is based on your average purchase share price. Not market cap. As these repetitive dilutive fundings occur, your stake drops. With just this last one alone, you own 8-9% less of the company than you did before.

Whether you make money on a buyout will depend on your average share price and the per share buyout price.

The bigger issue on a buyout IMO is that the company currently is not in a position of strength. This is reflected by the huge discounts they are forced to give up on the fundings. Therefore, it's not a large leap to assume that a buyout while wavx is in this position would probably not yield a large/desirable premium.