Stocks question for those that know about this stuff: public to private

[NDallasRuss]

I've had some (not a whole lot) shares of an OTC "penny stock" for a while now for a company I'm familiar with. They've been in bankruptcy, and their plan to restructure and emerge was passed last night. The plan includes going private. This morning their stock price has fallen by half. Again, I don't have a ton of their stock, so I'm not losing a fortune here, but I'm curious if it's going to eventually fall all the way to zero, and I should go ahead and get what I can?

From the tiny little bit I've read, it seems that to go private they'll offer to pay shareholders a little more than market value to buy back the shares. If that's the case, shouldn't the price go up, since shareholders know that an offer is coming?

Any insights are appreciated, as I keep trying to learn more.

Thanks!

 

[FAUlty Gator]

OP’s mom likes to show her privates in public.

That’s all I got.

 

[dgordo]

In theory if they are going private you should get bought out at the announced price. Lots of caveats.

 

[NDallasRuss]

In theory if they are going private you should get bought out at the announced price. Lots of caveats.

Will they be required to send out correspondence to all shareholders (even smaller ones like me)? Or because they're OTC there aren't as many requirements to notify everyone?

 

[HawkMachine]

If it dropped a bunch maybe it was overvalued at the time. Investors must have thought the current price was over the buyout price.

 

[Monzon]

In theory if they are going private you should get bought out at the announced price. Lots of caveats.

... and if the announced price hasn't been released, that will make people nervous enough to collect what they can now.

 

[TennNole17]

The buyback will be at an average price over a timeframe. So people sold now because they knew the average price isn't going to go up (who's going to buy it?)

Just my guess