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by nmlnn
2015 days ago
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> so what's going to stop someone coming along and saying "Hey, $X a share, I'll liquidate the BTC and hand it back to investors" when BTC has it's next dip? Maybe the fact that he has 72% of the voting rights and can basically do whatever he wants. |
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> Maybe the fact that he has 72% of the voting rights and can basically do whatever he wants.
And even if he didn't, this move is the perfect poison pill to prevent an hostile takeover: with the company massively leveraged on BTC, who'll be foolish enough to follow someone who's basically suggesting to realize the loss on the books? And while hoping this very action doesn't tank the company? It's an heroic assumption when debts remains to be serviced (ie, clear liquidity issues, that could crash stock price)
It could go to the point that not even whatever assets may remain would be enough to distribute anything at all to creditors! (ie, bankrupcy)
That IMHO is more concerning to any investor that trading at a discount vs the assets.
1980s style corporate raiding is 40 years old, so by now you must expect owner/founders to know a thing or two about poison pills!
Anyway, it's indeed a bold move, but the assets generate cash flow, and with 72% ownership, it strikes me as the RIGHT move IF the owner want to keep some liquidity handy for whatever project, without falling pray to inflation.
With 72% he can already can do what the hell he wants. He could distribute this as profit to himself but as a billionaire, does he really needs that cash RIGHT NOW? While we're expecting up to 40% inflation when the velocity of money rises back?
It's simpler to just keep the company coffer filled until a good use comes by - if only because there will be no need to bother with the TLAs like the SEC to issue bonds, and also because while parked, all that remains shielded from most taxes.
As a billionaire, it's just his form of edging, while also having a lifestyle business.