Even though PNSN is not being official held in the portfolio any longer, we will continue to provide information on PNSN at least for the time being.
The key question is if the present price discounts the dilution. The other key question is if there is more information that the company has not released.
Here is a quote from the company’s response:
Book value after dilution? Under the plan, we would eliminate approximately $176 million of debt and $30 million of annual cash interest expense, increase equity at our parent company, and potentially realize a significant one-time gain as a result of this exchange. So book value in total should increase, but I don’t have the mechanics of the accounting yet to tell you how it will all settle out.
Here is the email we have just written to PNSN:
Hello Gary,
Thank you for your response. It seems that the finance department at Penson should be easily able to provide the book value per share after restructuring. Can you please request such information from the finance department and provide the book value after the dilution at your very earliest?
Nigam
The Arora Report, Ltd
At this point, we simply need more information to make a judgement.
