Current Price – $0.42
Offer Price – $0.52-$0.6
Upside – 24% - 43%
Expiration Date – 12th of December, 2017
This idea was shared by Chuck.
Performance Sports Group went bankrupt a while ago and they sold the brands off pretty quick, enough to pay the creditors and have some money left over for the common stock. The creditors objected that the common stock was now owned by speculators (the float turned over many times since the bankruptcy) but the court said "no."
So, a vote is coming up for the equity holders in what they call the P7 equity class. According to the court docs, the left over money per share for the P7 class is going to be "Pro Rata share of Shareholder Distributable Assets, which is anticipated to be within a range of $0.52 to $0.60 per share "
Vote is due on the 12th of December and payout would likely be quick:
- Current liquidation plan is the result of settlement agreement reached by involved parties, particularly with the Plumbers & Pipefitters National Pension Fund, which sued the company on securities fraud basis. To avoid a long litigation this was the solution. Thus the involved parties seem be to be interested in cashing out asap.
- Secured already get 100%. Unsecured are taking a haircut. If they don’t vote yes they will get eaten up by the bankruptcy;
- US and Canada are both working on the bankruptcy at the same time and any kind a litigation will completely destroy anybody that wants to sue because they would have to sue in both jurisdictions;
- Risk is that the unsecured votes 'no', but if they vote no they probably won’t get anything.
Court documents can be found here