There is nothing wrong with Henry Williams' statement. Although the US Securities Exchange Act and Rule 144 have clear provisions regarding the reduction of holdings by major shareholders, there are also exemptions.
Just like KY Investment Fund now holds 7.2% of the shares of Boston First National Bank and 6.9% of the shares of John Hancock Mutual Life Insurance Company, both of which are the largest institutional shareholders.
According to the relevant laws of the United States Securities Exchange, if a new major shareholder like KY Investment Fund wants to reduce its holdings, it must wait at least two years. KY Investment Fund has held the shares of these two companies for less than half a year, so according to these regulations, KY Investment Fund cannot reduce its holdings within two years.
However, the US Federal Securities and Exchange Commission has also designated some exemptions for some special circumstances. For example, KY Investment Fund previously held no more than 5% of the shares of these two companies, only a little more than 1%. Later, it increased its holdings because of the stock market crash. In order to save the stock market, KY Investment Fund spent a huge amount of money to buy back stocks, which was an act of saving and supporting the market. Therefore, the shares that KY Investment Fund increased during the stock market crash can be classified as special exemptions as long as the holding period exceeds three months.
Of course, after the announcement of reduction, these increased shares should first be sold to internal shareholders. Only after the internal shareholders are unwilling to subscribe to these shares, will these shares flow into the circulation market.
In other words, these shares acquired during the stock market crash are not subject to sale restrictions under the U.S. Securities Act and Rule 144, but corresponding reporting to the Federal Securities and Exchange Commission is still required, and internal shareholders must first purchase them.
It was for this reason that Henry Williams dared to publicly announce that he would reduce his holdings in the First National Bank of Boston and the John Hancock Mutual Life Insurance Company.
As for who sold the huge amount of stocks at the beginning of the stock market, who knows! It must be that most investors are not optimistic about the future of these two companies, so they are competing to sell their stocks. It is because you did not do well enough and did not bring great confidence to investors, so it is not surprising that investors abandoned you.
In fact, it is not only ordinary shareholders who have abandoned you. Even I, the largest shareholder, am not optimistic about your future. Tell me, what is left for you to do? You deserve such a sharp fall!
The decline in just one day caused the stock prices of these two companies to drop directly to the level of the day of the stock market crash. At this time, even if internal shareholders want to repurchase these shares, they must repurchase them at the stock price when KY Investment Fund announced the reduction.
This put the Boston consortium in an awkward position. They really didn't expect that the stock price of their core enterprise would fall so badly in one day. Even if they wanted to buy back the shares of KY Investment Fund, they had to buy them back at the price before today's opening, which means that the repurchase price would be 28% higher than the actual stock price.
No one would be such a sucker. Even if the Boston consortium buys back the circulating stocks at a low price from the market, there is still a huge amount of selling pressure overhead - the largest shareholder is reducing his holdings, which is more explosive than any other negative news!
But if the Boston Consortium does not repurchase these shares, then when the time specified by the Federal Securities and Exchange Commission arrives, the KY Investment Fund can sell these shares at the market price even at the risk of not making any profit. In that case, the Boston Consortium will be in even greater trouble.
If the market value of Boston First National Bank was $56 billion before the crash, the 5.8% of shares that KY Investment Fund increased its holdings during the stock market crash had a market value of about $3.25 billion. This is not a small number, and it can definitely keep the stock price of Boston First National Bank in a state of decline for a long time, which will last at least three months or even more than half a year. Only with such a long time can the market digest such a large sell-off.
Even if the market digests such a large sell-off, it will take a long time for the stock price of Boston First National Bank to return to the price before today's opening!
It is not impossible for KY investment funds such as the Boston Consortium to take over these stocks after they have put them into circulation, but that requires avoiding the supervision of the Federal Securities and Exchange Commission - Oh, you don't buy back when others are reducing their holdings, and wait until they put the stocks into circulation before buying back. This is a violation!
Of course, the Boston Consortium can find another institution to buy back these shares from the market, or at most the board of directors can change another shareholder. But then again, KY Investment Fund is obviously going to make things difficult for the Boston Consortium. At such a sensitive moment, who would dare to take such a big risk to buy back these shares?
Everyone knows that KY Investment Fund is not to be messed with now. They have massive capital and are rich and willful. If you dare to buy, they will dare to smash it. KY Investment Fund can smash it even at the cost of losing money. After you buy these stocks, can you afford the loss of hundreds of millions or even billions of dollars?
Therefore, this move by KY Investment Fund can be called a family-killing move! Whoever dares to help the Boston Consortium should first check whether there is so much money in his wallet for you to lose!
If you don't have the capital, don't get involved in this matter. This matter is a feud between KY Investment Fund and Boston Consortium, no one can say anything about it!
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