I am studying SEC filings and would like to know what happens to existing shares of a company when it merges with another company with a higher share price.
For example a recent company with a average share price of say 0.70 has merged with a company that has a share price of 6.00. The lower price did a reverse stock split of 11/1 and also gave substantial amounts of shares to company execs and promoters etc for when the merger is finalized.
Does this mean that the lower price shares be converted over to 6.00 under the new company share price, or is this just for the company execs.
What happens to the shares of the other investors, ie retail investors like you and me. Are they also automatically converted over to 6.00
If anybody wants to look into the company I am studying, it is Vaxart (VXRT) and their merger with Aviragen (AVIN)
You can find your answer by reading SEC documents as those details have to be disclosed: https://www.sec.gov/Archives/edgar/data/72444/000143774917021271/avir20171220_s4a.htm Search for "At the closing of the merger" and read that section, then follow the comments for more details. Usually when you have mergers, old stock is exchanged for the new one at some ratio dependent on price and other factors of the deal.
Thank You For The Help.
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