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08-11-2010, 09:48 AM
The senior Cheng and his right-hand man Lee may be good operators, but I guess they could have taken the wrong financial advice from someone in doing the large warrant issue. Due to the issue's large size (130 warrants) and high conversion price ($0.26/warrant), it will be quite tough for most Hai Leck shareholders big and small holding a meaningful stake relative to their own financial resources.
Shareholders and potential investors must and will recognize the coming big dilutive impact the conversion of the 130m warrants have on Hai Leck's EPS. This should exert a certain dampening impact on Hai Leck's share price until Dec11 at least. To me, the conversion of the 130m warrants into new Hai Leck shares is like a knife on the throat of those minority shareholders who may not be able to take a long enough view on their investment.
Shareholders and potential investors must and will recognize the coming big dilutive impact the conversion of the 130m warrants have on Hai Leck's EPS. This should exert a certain dampening impact on Hai Leck's share price until Dec11 at least. To me, the conversion of the 130m warrants into new Hai Leck shares is like a knife on the throat of those minority shareholders who may not be able to take a long enough view on their investment.