Spin-off22 Nov 2021 15:52
Whilst we wait for news on all fronts, I keep reminding myself of the potential for the deal with China Resources to manifest itself as a ‘spin off company’ that could be listed on the Hong Kong Stock Exchange.
Such a spin-out transaction could provide the opportunity to secure separate financial resources for this company, to enable accelerated development and growth.
A spin-out transaction would also allow Shareholders to benefit from both the value of the development assets and the standalone value of the core services business,(DeepVerge).
A distribution in Specie would reward existing shareholders in DeepVerge with pro-rata shares in the ‘spin–off’ company.
I experienced something akin to this with the Poolbeg spin-off from Open Orphan.
I am not convinced the market knew what to do about a company seemingly ‘offloading’ assets. That is not how I saw it, but the market reacted badly. There are, of course, other aspects that affected ORPH’s price which I don’t intend to elaborate on on this board.
Maybe it is this veiled threat of a spin off that has spooked a few. The market hates uncertainty.
Just a thought.
Still here, still very confident and waiting for news.