Hmm... I'll look into what actually happened (i.e., whether new shares came from GME treasury or was a new offering authorized by the exchange) but any new share offering can only dilute the value of all existing shares in circulation. It's simple. Saying that GME management is handling the windfall wisely or not is a whole different topic.
Basically GME had a sell contract filed in 2019, which said they could sell up to 6,000,000 shares for a total of $100,000,000. No more of either. This week, GME UPDATED such contract, or deal, whatever you wanna call it.
The updated deal says, that GME can at any point sell UP TO 3,500,000 shares for UP TO $1,000,000,000.
So technically, GME gave themselves the right to make up $1B, with less shares.
HOWEVER, they can exercise this at any price point. So technically, if the share price for GME during the squeeze is at $1M, they’d only have to sell 1,000 shares... TOTAL. If it’s at $10M, 100 shares would do.
Hmm... I'll look into what actually happened (i.e., whether new shares came from GME treasury or was a new offering authorized by the exchange) but any new share offering can only dilute the value of all existing shares in circulation. It's simple. Saying that GME management is handling the windfall wisely or not is a whole different topic.
I actually did some DD on this.
Basically GME had a sell contract filed in 2019, which said they could sell up to 6,000,000 shares for a total of $100,000,000. No more of either. This week, GME UPDATED such contract, or deal, whatever you wanna call it.
The updated deal says, that GME can at any point sell UP TO 3,500,000 shares for UP TO $1,000,000,000.
So technically, GME gave themselves the right to make up $1B, with less shares.
HOWEVER, they can exercise this at any price point. So technically, if the share price for GME during the squeeze is at $1M, they’d only have to sell 1,000 shares... TOTAL. If it’s at $10M, 100 shares would do.
That seems to be a square deal, then. Thanks for the research.