The never ending "legal" saga (scam) of DRYS explained in layman's terms:
1) Big George (CEO) finds "Investor XYZ" to inject capital into the company. In return, XYZ gets to purchase X amount of shares at a much lower price than the current trading price. Also, George probably has some behind-the-scene relationship with XYZ that is not disclosed, resulting in $ for him. DRYS stock is massively diluted as a result. 2) The capital injected into Dryships is used to purchase new ships from private companies that are controlled/owned by - you guessed it - Big George. This results in more $$$ for him. 3) XYZ immediately and continuously dumps all accrued shares until the share price of DRYS drops below a certain price point that XYZ no longer profits off it. 4) The board of Dryships (in reality just Big George) votes to impose a Reverse Split in order to prop back up the share price of DRYS. 5) Once the RS occurs, steps 1, 3, 4 occur again, and repeat in a never ending cycle. Any capital received from XYZ is somehow used in a manner that is profitable for Big George, not Dryships as a company, and certainly not DRYS stockholders. 6) Big George could care less if Dryships goes bankrupt, as he has very little assets directly associated with the company. The only reason he wants to keep it afloat is so that he can perform his scheme over and over again. 7) The worst part is this entire process is 100% legal (besides any shady agreements he has with XYZ.) 8) The price of DRYS stock will forever go down as there will be an infinite amount of dilution & reverse splits (it was a high as $1,516,947.87/share when factoring in RS's back in 2007.) 9) If you own DRYS stock, you will be a bagholder and eventually lose 99.99% of your $ (or more if on margin.) 10) Have a good day. |