BTW, Apple is doing the same !
Issuing debt at very low rates and buying back shares.
They don't to raise money anytime soon. They are burning $15M and have over $60M in the bank.
They have enough money for the next four years. By then, they will have more than one approved and marketed product that generates high revenues.
The authorization is mainly technical. Let's say that they get an approval for RHB-105 and the stock price to $20. They can do a secondary at much higher levels without asking for an authorization to issue more shares.
You can take it to the bank,
My suggestion is based on the fact that RC kept buying shares in the $24.5 range and if the deal falls apart the share price might drop to under $20.
If they want to take a $5 drop on 2.4M Shares they should vote against. Since they no longer have a put protection, they are exposed just like the rest of us....
If Raging is going to vote FOR the deal, they will have to announce it prior to the meeting.
Otherwise, the vote may actually not get approved and they will tons of money..
They are not buying any more shares. Any shares bought after December 18th can't participate in the vote.
Raging decreased their Jan 25 Puts position from 9,000 to 2,000...
My guess is that they are working behind the scenes to increase the offer by 10% for them to vote for the deal.
Check their daily put trades,
You are wrong about the puts... Raging owned 9,000 of put 25/20 put spread that cost them 85c.
During this week, they've been selling the 25 puts. My guess they owned around 6,000 of those spreads and plan to liquidate the rest and go with the MLNX deal....
Now you have a 30 day of go shop period.... No one will buy this POS for more than MLNX is offering.
MLNX pulled an amazing move that puts Raging Capital in the penalty box.
If the shares close under $25 by next weeks expiration, Raging will have to roll their puts or sell their shares at $25.
And if no better offer surfaces, Raging will have to eat their hat,
I have no position in EZCH.
MLNX won't raise their bid for EZCH. I truly hope that the share holders reject the deal and EZCH will drop to under $20 to teach those greedy people a lesson.
Get your facts right. Raging capital is fully hedged. If the stock drops back to $15 if the deal fails to close, they won't lose anything.
On the other hand, other shareholders will lose tons of money.
How come no one came with a better bid than MLNX?
I think Raging Capital plan if to fail the deal so they can sell their position via the puts at $25 and buy at the mid teens again,
From EZchip filings, it appears that Raging Capital has hedged its position in EZchip through acquiring, at USD 25, put options expiring after the AGM. This strategy creates a potential misalignment of interests with EZchip other shareholders who are not protected with similar put options in the case that the merger does not go ahead. However, this detail is not mentioned in the letter issued by Raging Capital to EZchip shareholders.
If you intend to vote no, buy November puts to protect yourself !!
The last quarter was amazing and the guidance was great only to see to see the share price to drop from $49 to $40 prior to the recent market correction.
Share some of what you are smoking,