https://www.msn.com/en-us/finance/companies/occidental-plans-to-issue-stock-warrants-after-slashing-dividend/ar-BB161973
9 replies (most recent on top)
X Loxy here. I admit there were alot of imperfections at oxy. Management talent was very questionable. The apc purchase and how it was done backdoor is an obvious mistake. But I have good friends there still employed at oxy, I do not wish for it to go bankrupt. But we all know the pain is growing with all these movements in motion. They have been saying 2020 is going to be ok, it's the 2021/22 bond payments at issue. The stock get diluted is pretty concerning and foretelling if u ask me.
"most employees feel disenfranchised by an EC that would go around shareholders and do whatever they want"
Exactly! This is what it boils down to. EC, how can you expect us to TRUST you?
I don’t think it is so much that a bunch of employees want oxy to fail, but rather most employees feel disenfranchised by an EC that would go around shareholders and do whatever they want. Even if it meant collateral damage to the employees who didn’t have a say in the matter. They will write case studies about corporate greed ruining oxy for years to come.
It really does sound like a good idea, and I really do hope the company survives. It amazes me that certain employees seem to want it to fail.
It is a great distraction. Helps to dissipate current pressure making you think in a rosy future. Fight for survival Oxy!
Have to make Ichan happy!
Good thing the warrants are good for 7 years and not 5.
This is a good thing. With debt restructuring and stock warrants, OXY is taking the necessary steps to survive long term. I was unfamiliar with stock warrants, so I had to look it up. For every OXY share owned, you receive 1/8 stock warrant. The stock warrants act similarly to stock options and will be good for a period of 7 years from the issue date and give the holder the right to buy OXY at $22/share. So, let's say that 5 years from now OXY stock is at $60/share and this is the point that you choose to exercise your stock warrant. Let's also assume I own 1,500 shares of OXY so I have received 187.5 stock warrants. So essentially in 5 years when I chose to exercise the warrant, I would buy and sell the shares for a net of $7,125. Is it as good as a dividend, no. Is it something of value, yes.
Issued warrants only dilute shares even more. Current bag holders still can buy shares on the open market for cheaper or even less over the few months. Haven't seen figures yet on the terms but it could be months before stock hits this price range. Which may not be enough time to avoid BK. Not sure if all the debt for 2021 was sold /restructured but thats the main goal of this move..... delay BK.
Uncle Ichan and Warren may just use this as a way to cash out. We already know both of them have cheap stock. So any price north of 15 is probably value to them. Then they wont care what happens next.