Issuing millions of shares at multi decade low and accommodating the same bond holders who shorted ENER at much higher price to cover. If every thing is getting better and they're turning a corner why issue shares at such a historical lows.
manwork - It is frustrating to see this Chinese water torture type dilution but unfortunately when you are essentially owned by the investment banks you have to play by their sleazy rules. Most likely ENER will have to go back to them for additional financing at some point so ENER has to play nice for now.
At current prices, is it really dilution when you count the $2 per share premium the noteholders paid for the 1.3 million shares issued to retire the 9.1 million in notes in the most recent transaction and the $682,500 in saved interest over the 2 1/2 remaining years before maturity of the notes?
Yes, I remember when the stock was $80 per share but those days are gone and there is a need to manage cash now until the company returns to profitability. If it pulls that off, the adjusted dilution,to the extent it exists, won't be so hard to take.
Finally, the current noteholders doing these tranactions may well not be investment banks. The total exchanges so far amount to only about 10% of the outstanding debt. To the banks that is small potatoes.I believe the notes are negotiable,and my guess is that those transactions are being done by smaller holders who see more advantage in holding the stock than the notes. That is a comforting thought.
the bonds are not due for another 2 1/2 years and the interest rate is only 3%. my question is if everything is turning around for the company why not Waite for the stock price to appreciate and then do secondary.