so the majority owner can say $0.01 and since he owns 50.1%+, it's goes thru?
sounds like lawsuits waiting to happen
I don't think it could be that bad. The offer should be at current quote or higher. So if the stock drops 10%, I could be forced to take that loss instead of waiting for the share price to recover. It is more of a case that if the majority shareholder wants to take it private, there is not much that can be done to stop it.
The link to investipedia tells you about things that can be done to prevent this.
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I think what this company is doing is interesting. Remember all the remodelers pre housing bubble that were making a killing then probably became bag holders? This company sounds like it is doing exactly that in Florida. Watching TV shows ("documentaries") on the topic, it can be very lucrative. Some people on these shows are morons (Flipping Vegas) but there was one in Texas and boy, did that guy run a tight ship.
Flip a house over 2-6 months, take the 20% profit and reinvest. It's a compounding machine. The thing is, a CEO with excellent financial understanding that can weather the downturns in the industry will eat into the competitors markets as the weak go under are weeded out. Remember, each recession will cause some of the competition to go under if you are the best in the game.
The big issue is that this model can easily be copied. But in the beginning, there should be plenty of room for growth.
I think I read that it is being structured as a REIT. I hope they also keep some properties as rentals to help weather downturns with less volatility.
Anyways, it is a somewhat speculative investment. And with such a small market cap that it is WAY under the radar of most.
Ramblings:
It's not like AMD where everyone buying and selling has the same knowledge base. Competitive advantages are not just for the managements of Target and Wal-Mart to understand. People forget that investors need a competitive advantage against other investors. No investor in AMD has such an advantage. But now I am talking about investing on a site not built for it so I'll just stop. But one last thing. Mispricing often occur in turnarounds these days. The thing that is amazing is that no one seems to know that companies are publicly announcing things are vastly important and due to this, mispricings can occur on occasion. RFP and ZINC are two screaming examples of this. Why does no one notice? Over-reliance on screeners and financial metrics. The failure is that those devices only tell the past. Read articles on BBRY. Every one of them focuses on handsets. Even here, handsets. Ya, let's say they shut down that piece of the business entirely. Then what? I love having a competitive advantage against my competition.
FWIW: JNJ was a good deal for years before it's recent near 100% run up. That was easily found via screener.
This is a good talk. It's helping re-organize my thoughts. Might have to turn it into an article (I get paid to write for value investing sites on occasion).