Skip to content
Andrew Tobias
Andrew Tobias

Money and Other Subjects

  • Home
  • Books
  • Videos
  • Bio
  • Archives
  • Links
  • Me-Mail
Andrew Tobias
Andrew Tobias

Money and Other Subjects

Borealis Gets a Dividend

June 8, 2007March 6, 2017

You will recall that Borealis is divided into 5 million shares and that it owns 5 million shares in each of its subsidiaries, such as Roche Bay Mining, which is divided into about 7.5 million shares.

If there is a 30 mph head wind and Julie had three times as many marbles as Peter when they started out at 180 mph, how many shares of Roche Bay does Borealis effectively Own?

That’s right! Five million! About two-thirds of the total.

So the latest is that a little Canadian mining outfit called Advanced Explorations (whose own stock – symbol AXI on the Vancouver stock exchange [oh, stop laughing] – had been suspended from trading until this deal was complete) announced that it has raised $10 million or so to fund its initial work commercializing the Roche Bay iron ore holdings – for which large offtake agreements are already in hand, if we can produce the ore.

AXI, which had closed months ago at 31 cents (Canadian) when the trading stopped reopened yesterday on this news and closed at $1.50 (Canadian) on volume of a little more than 1 million shares.

As part of the deal, AXI acquires a big chunk of Roche Bay . . . but also gives Roche Bay 8 million warrants to buy AXI stock at 35 cents . . . and Roche Bay yesterday announced that it would be giving a dividend of half on one of those warrants (called ‘share purchase rights’) for each share of Roche Bay held.

Bueller? Bueller?

Well, since Borealis owns 5 million Roche Bay shares, and Roche Bay is paying out half an AXI warrant for each one, how many chucks could a wood chuck chuck if a wood chuck could chuck wood?

Answer: Borealis gets 2.5 million warrants, with a current intrinsic value of $1.15 each (namely, the $1.50 you could sell the stock for yesterday, minus the 35-cent exercise price of the warrants).

So, if one assumes the AXI stock will stay at $1.50 – a big assumption, although of course it could also go higher – then these 2.5 million warrants are worth $2,875,000 (Canadian).

Could that be enough to help fund WheelTug and some of the other promising technology?

Borealis remains a wild speculation; but with this deal closing, the hoped-for iron ore bonanza comes a step closer . . . and a bit of seed cash for WheelTug (and for some of the other hoped-for technological breakthroughs) may become available this October, when the restriction on selling the warrants is lifted.

A lot of you are – rightly – skeptical of Borealis. But the company is certainly far ahead of where it was eight years ago, when we started this nutty thread. The plane moved. Delta has signed on to try to retrofit thousands of jets. Crews are drilling core samples up in the subArctic.

You never know. Three years from now, our iron ore ships may have come in, and 737s could be pushing back from the gate on their own power.

Visions of sugar plum fairies dance in my head.

Have a great weekend.

Post navigation

← Fun and Games
The Iniquity of Inequity →

Quote of the Day

"Money is a singular thing. It ranks with love as man’s greatest source of joy. And with death as his greatest source of anxiety. Over all history it has oppressed nearly all people in one of two ways: either it has been abundant and very unreliable, or reliable and very scarce."

John Kenneth Galbraith, The Age of Uncertainty

Subscribe

 Advice

The Only Investment Guide You'll Ever Need

"So full of tips and angles that only a booby or a billionaire could not benefit." -- The New York Times

Help

MYM Emergency?

Too Much Junk?

Tax Questions?

Ask Less

Recent Posts

  • Unbelievably Bad -- Literally

    July 4, 2025
  • Repeal The Steal

    July 2, 2025
  • Our Record-High Stock Market

    June 30, 2025
  • Stuffing The Goose

    June 30, 2025
  • Yes! (Plus A Bonus)

    June 29, 2025
  • How Does THAT Make You Feel . . .

    June 27, 2025
  • Randi, David, Ken, and HYMC

    June 26, 2025
  • Six Links For Your Consideration

    June 25, 2025
  • Weekend Reading

    June 20, 2025
  • Oh, My

    June 18, 2025
Andrew Tobias Books
  • Facebook
  • Twitter
©2025 Andrew Tobias - All Rights Reserved | Website: Whirled Pixels | Author Photo: Tony Adams