I find the way management is presenting/structuring this spinoff transaction to be pretty self serving and manipulative. They are going out of their way to make it complicated instead of just doing a straight 1 for 1 spinoff and keeping the international business public. By structuring it as a right they are clearly hoping most retail investors won't participate and they can then increase their ownership in the PNG business at a very low price by backstopping the rights offering.
I agree with you. I am not impressed with how the deal has been structured. I suppose the opportunity (or at least my perceived opportunity) wouldn't be present if they did everything in a way that supported retail shareholders.
Ideally the PNG biz should be listed on another exchange. I can see why they would want to just have it be private as dealing with the public markets as a cash generating business when you don't need any financing is really just a distraction.
I suppose I see this as lowish risk, high uncertainty.
I'm not sure it really means much. Cyrus has had members on the board for over a decade and they said in the press release that they are supportive of the transaction. I am curious how they will backstop the deal with the shareholders that don't exercise their rights to purchase the PNG business. So many comments about the liquidity being an issue, so I can't imagine they get much of the retail shareholders to purchase.
I find the way management is presenting/structuring this spinoff transaction to be pretty self serving and manipulative. They are going out of their way to make it complicated instead of just doing a straight 1 for 1 spinoff and keeping the international business public. By structuring it as a right they are clearly hoping most retail investors won't participate and they can then increase their ownership in the PNG business at a very low price by backstopping the rights offering.
Thanks for commenting.
I agree with you. I am not impressed with how the deal has been structured. I suppose the opportunity (or at least my perceived opportunity) wouldn't be present if they did everything in a way that supported retail shareholders.
Ideally the PNG biz should be listed on another exchange. I can see why they would want to just have it be private as dealing with the public markets as a cash generating business when you don't need any financing is really just a distraction.
I suppose I see this as lowish risk, high uncertainty.
Dean
Hi Dean, have you seen the news that one of Cyrus's directors resigned from the board? I'm curious what it means? Thanks
I'm not sure it really means much. Cyrus has had members on the board for over a decade and they said in the press release that they are supportive of the transaction. I am curious how they will backstop the deal with the shareholders that don't exercise their rights to purchase the PNG business. So many comments about the liquidity being an issue, so I can't imagine they get much of the retail shareholders to purchase.
Thanks for the comment.