Management is draining money out of the corporation for expansion, lowering book value to
make the privatization offer look good. Do you believe management is spending the companies money to review a $2.00 offer when the book value is 1.5 time that amount. SG& A has increased $15M in the past year, and what have we seen for that huge increase in costs? Add the deemed dividend and that equals a management that has concocted a way of killing the price of a stock and making it an easy target for takeover at a depressed price.
This was copied from the companies release:
The increase of SG&A for the twelve months 2012 was due to increased rental space and marketing and staff expenses to support the expansion of the retail network and professional fees incurred in relation to the privatization proposal.
Agreed. But I still believe that management gains the MOST by accumulating shares under $2.00, then reducing expenses, continuing to increase revenues through store expansion and branding efforts---all moves which creates the IPO opportunity (or an acquisition)
This growth stock should have a pps of $4.00 without the preferred stock deal and a more frugal expansion plan... How does management make the most money going forward? If other interested parties start acquiring shares I believe $1.92 will remain the floor.
Santa Claus provided $.12; the leprechauns another $.02----now it's time for the Easter Bunny to take us over the $2.00 mark. More stores, faster revenue growth, more cost amortization---an uptrend in eps.----watching volume----someone is accumulating at a cost under $1.93.