lb3 said:
RED AG 98 said:
I've been on the wrong side on this one before, about 15 years ago at a startup. Same deal right before we went public -- 3:1 stock pplit, dilutes all Common shares but typically doesn't impact the Preferred shares that the early investors and founders hold.
They aren't printing new shares. They're splitting them so those with 1 share now have 3 shares. Nobody is getting diluted.
Pretty sure they're issuing a bunch of new shares and those have been bid and guaranteed by select institutional firms that brought the money to the table. This 5:1 split is just to increase liquidity once all of those shares hit the markets. We (or at least I) also don't know what specific preferred class shares will remain and which ones will convert at similar or other ratios. It's possible that very early investors will see their preferred shares converted at much much higher ratios.
Another question I have is the impact of this IPO on the broader markets. Initially will it bring a whole host of fresh and new cash/capitol to the market or will we see a broader market sell in the days leading up to the IPO as SpaceX buyers free up the cash they need to fulfill their purchase obligations?