Author Topic: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?  (Read 123747 times)

gokou3

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #380 on: September 04, 2018, 01:32:50 PM »
Basically Roumell is asking the company to stiff the E holders instead of the common holders.  I like that.  E holders have been living in a fantasy for a long while (until recently) that they would get par back in 2019.


Rod

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #381 on: September 04, 2018, 01:55:20 PM »
The proposal to offer a discounted extended security to replace the DC.PR.E is a new one that was mentioned on this board before. Obviously any discount would be accretive to NAV and improve the liquidity position which would support the valuation of the DC.PR.B and DC.PR.D.

Any thoughts on a paired trade--long E and short Common? Right now the E is trading at par with the Common assuming conversion. This seems to assume there is zero chance of the E getting paid cash--even partially. And in Jim's "haircut" scenario the haircut would have to do less damage than a conversion or why would the E's vote in favour?

The only risk I can see is that the company comes into some good luck with asset sales and maybe strong results from Delonex and the Common soars. At the same time the company has enough new liquidity to pay the E in cash. E's would get $25, but the loss on the short side of the trade would be much higher.

SafetyinNumbers

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #382 on: September 04, 2018, 02:00:32 PM »
The proposal to offer a discounted extended security to replace the DC.PR.E is a new one that was mentioned on this board before. Obviously any discount would be accretive to NAV and improve the liquidity position which would support the valuation of the DC.PR.B and DC.PR.D.

Any thoughts on a paired trade--long E and short Common? Right now the E is trading at par with the Common assuming conversion. This seems to assume there is zero chance of the E getting paid cash--even partially. And in Jim's "haircut" scenario the haircut would have to do less damage than a conversion or why would the E's vote in favour?

The only risk I can see is that the company comes into some good luck with asset sales and maybe strong results from Delonex and the Common soars. At the same time the company has enough new liquidity to pay the E in cash. E's would get $25, but the loss on the short side of the trade would be much higher.

I think the risk would be that in an extension scenario that is a haircut as suggested, the common could rally as it would avoid dilution in the near term at least and the upside on the DC.PR.E would be limited.
Top 5 positions: ELF IAM GCM.NT/GCM PIF EFR.DB

Rod

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #383 on: September 04, 2018, 02:51:55 PM »
The proposal to offer a discounted extended security to replace the DC.PR.E is a new one that was mentioned on this board before. Obviously any discount would be accretive to NAV and improve the liquidity position which would support the valuation of the DC.PR.B and DC.PR.D.

Any thoughts on a paired trade--long E and short Common? Right now the E is trading at par with the Common assuming conversion. This seems to assume there is zero chance of the E getting paid cash--even partially. And in Jim's "haircut" scenario the haircut would have to do less damage than a conversion or why would the E's vote in favour?

The only risk I can see is that the company comes into some good luck with asset sales and maybe strong results from Delonex and the Common soars. At the same time the company has enough new liquidity to pay the E in cash. E's would get $25, but the loss on the short side of the trade would be much higher.

I think the risk would be that in an extension scenario that is a haircut as suggested, the common could rally as it would avoid dilution in the near term at least and the upside on the DC.PR.E would be limited.

I think you are right that there are other risks. I am still kicking myself for not shorting the E at $24 in July before the Q2 release when the Common was around $1.50. That was a "Wiley Coyote" moment--the E holders had yet to look down and see how much they would lose on conversion at $2! It was also a one-way bet since it couldn't go up, only down.


bizaro86

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #385 on: September 04, 2018, 05:59:31 PM »
The proposal to offer a discounted extended security to replace the DC.PR.E is a new one that was mentioned on this board before. Obviously any discount would be accretive to NAV and improve the liquidity position which would support the valuation of the DC.PR.B and DC.PR.D.

Any thoughts on a paired trade--long E and short Common? Right now the E is trading at par with the Common assuming conversion. This seems to assume there is zero chance of the E getting paid cash--even partially. And in Jim's "haircut" scenario the haircut would have to do less damage than a conversion or why would the E's vote in favour?

The only risk I can see is that the company comes into some good luck with asset sales and maybe strong results from Delonex and the Common soars. At the same time the company has enough new liquidity to pay the E in cash. E's would get $25, but the loss on the short side of the trade would be much higher.

I think the risk would be that in an extension scenario that is a haircut as suggested, the common could rally as it would avoid dilution in the near term at least and the upside on the DC.PR.E would be limited.

I think you are right that there are other risks. I am still kicking myself for not shorting the E at $24 in July before the Q2 release when the Common was around $1.50. That was a "Wiley Coyote" moment--the E holders had yet to look down and see how much they would lose on conversion at $2! It was also a one-way bet since it couldn't go up, only down.

I tried to short the E then and couldn't find borrow.

Rod

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #386 on: September 05, 2018, 02:07:44 PM »
I tried to short the E then and couldn't find borrow.

At least you were smart enough to try.

sculpin

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #387 on: September 10, 2018, 02:44:01 PM »
Through it's holding in Union Group, Dundee indirectly owns 16M shares of ICC Labs (ICC-X), a Cannabis producer in Uruguay. I think it's worth watching because ICC has recently moved up from $1 to $1.70 as it seems to be catching the cannabis wave. At the current price it's worth about 50 cents per Dundee share, or roughly 20% of the market cap. I guess a best case scenario would be that ICC shoots up to $5 or so on a take over or continuation of the bubble, and Union Group sells. Dundee's share of that value would be about $1.40 per share, more than half the current market cap, a not inconsiderable amount.

Thanks for noticing that and letting us know

A Uruguayan news source has reported that Aurora is in talks to acquire the ICC business. Haven't seen anything from a Canadian source yet.

https://www.busqueda.com.uy/nota/una-empresa-productora-de-la-marihuana-oficial-negocia-su-venta-la-principal-compania-de

No idea of the legitimacy of the article or report, only thought it might be interesting for Dundee followers.

ICC sold to Aurora for $1.95 per share...

https://www.newswire.ca/news-releases/aurora-cannabis-to-acquire-south-american-market-leader-icc-labs-692843161.html


bizaro86

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #388 on: September 10, 2018, 03:08:32 PM »
Too bad they're taking shares here.

Rod

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #389 on: September 10, 2018, 07:12:50 PM »
Too bad they're taking shares here.

And too bad those shares will be held by Union Group, the company that can't provide audited financial statements. How exactly does that work? Doesn't "can't" mean "won't"? And why wouldn't they? Wouldn't the most reasonable conclusion be that Union Group has been involved in some kind of fraud?