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SCO Investor Changing the Deal
Kurt Wall writes "According to this story, recent SCO investor Royal Bank of Canada appears to be changing its tune. RBC, along with BayStar Capital, invested $50 million in SCO, but now has changed the deal to give it veto power over the payment of the 20% contingency fees SCO's IP lawyers will get. As to the wisdom of the investment itself, an RBC spokesman would only say that the 'investment in SCO is passive, made to hedge an economic exposure resulting from client transactions.' Such as the SCO case collapsing, perhaps?"
..doesn't appear impressed with SCO either!
Donte Alistair Anderson Roberts - hi son!
Karma: Chameleon
Probably you! You support SCO if you have investments with any of these companies or mutual fund holders...
Capital Guardian Trust Company 1,177,800 8.51 $16,288,974 30-Sep-03
Integral Capital Management Vi, LLC 316,600 2.29 $4,378,578 30-Sep-03
Royce & Associates, Inc. 1,441,200 10.41 $19,931,796 30-Sep-03
Integral Capital Management V, LLC 246,730 1.78 $3,412,275 30-Sep-03
Empire Capital Partners LP 205,000 1.48 $1,961,849 30-Jun-03
Barclays Bank Plc 174,686 1.26 $2,415,907 30-Sep-03
Bjurman, Barry & Associates 160,000 1.16 $2,212,800 30-Sep-03
ING Investments, LLC 143,100 1.03 $1,979,073 30-Sep-03
Oberweis Asset Management Inc. 112,000 0.81 $1,548,960 30-Sep-03
Whitney Asset Management LLC 76,967 0.56 $1,064,453 30-Sep-03
Royce Technology Value Fund 105,000 0.76 $1,004,849 30-Jun-03
Vanguard Total Stock Market Index Fund 24,713 0.18 $236,503 30-Jun-03
Vanguard Extended Market Index Fund 17,875 0.13 $171,063 30-Jun-03
Marketocracy Masters 100 Fund 3,900 0.03 $53,937 30-Sep-03
Spartan Extended Market Index Fund 3,753 0.03 $54,831 31-Aug-03
Spartan Total Market Index Fund 3,132 0.02 $45,758 31-Aug-03
Vanguard Balanced Index Fund 2,125 0.02 $20,336 30-Jun-03
Quantitative Master Series Tr-Extended Market Index Seri 1,775 0.01 $16,986 30-Jun-03
Vanguard Institutional Index-Inst Total Stock Market Ind 705 0.01 $6,746 30-Jun-03
Manufacturers Investment Trust-Total Stock Market Index 349 0 $3,339 30-Jun-03
SCO's lawyers: "That wasn't part of the bargain!"
RBC: "We're altering the deal, pray we do not alter it further...
They aren't altering SCO's deal with the lawyers.
What they're doing is getting agreement from SCO that SCO will not take an additional unilateral action (such as selling the company) that will trigger the CYA part of the deal (giving 20% of the company to the lawyers) - unless SCO first gets investor approval.
"You promised them 20% of the company if you sold it. That would dilute our investment. So don't do that without asking us first."
NO change to the deal with the lawyers. Just don't push the red button (and give away a fifth of the store) without asking the owners first.
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
It loses you no money
I don't understand what you wrote. But you seem to be saying that short-selling is low-risk, which is totally wrong.
Here's how short-selling works:
You expect a stock to go down in price. You borrow some shares of the stock, and sell them. Then at a predetermined date, you must buy the stocks back, and return the shares to whomever loaned them to you. If you sell at $16 per share, and buy back at $10 per share, you get to keep $6 per share, less any fees (you need to pay whomever loaned you the shares).
But if you buy at $16, then Darl announces that SCO actually owns South America and the stock price goes up to $26, when it's time to buy back the stock shares you need to pay $10 per share.
If you simply buy some stock, the worst thing that can happen is that the stock devalues to zero, and you lost all the money you spent on the stock. With short-selling, if the stock price unexpectedly soars, you can lose vast sums of money in a hurry. Buy-and-hold is much safer than short-selling.
steveha
lf(1): it's like ls(1) but sorts filenames by extension, tersely
And announced the intention to sell 30,000 more. In addition to the tens of thousands he's sold over the last months.