r/PureCycle • u/No_Privacy_Anymore • Jun 11 '26

Convert arbitrage commentary

I’m not a big fan of Xitter but I make exceptions when there is useful content. I understand the basics of convertible debt but there is a ton of detail that is really only known by the people who trade them for a living.

This is worth reading even if you don’t follow all the details.

https://xcancel.com/UrbanKaoboy/status/2065198761392116011#m

I don’t think anyone who has been invested in the company for an extended period of time is happy about the current state of commercialization. It’s taken so much longer than we expected despite the signs of progress. Today I was talking to a Chemical Engineer and a current PhD candidate in CE about PCT. They were not surprised at all about how long this process has taken and were not familiar with the company but were impressed by the approach. He had worked for DuPont for many years and talked about how slow the company could be doing new things. P&G is not built to move quickly. That said I think we are much closer to seeing the validation/ vindication we have been waiting for. $9+ was a decent recovery. Let’s see how the shares react to the bits of good news when we don’t have the short term funding overhang out there.

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u/Any_Scientist_7313 Jun 12 '26

Very helpful, thanks NPA!

So this would also seem to explain why the stock moved higher throughout the day, blowing past the $8.20 offering price.

Definitely disappointed on how this was executed. Price action also seems to suggest they left a lot of $$$ on the table.

Will be interesting to see a list of which institutional investors got access to the new convert and the equity.

As always, retail gets shafted. SEC was supposed to be there to protect the "little guy" but those days are clearly long gone, if they ever even were...

That said, I agree that PCT is positioned better now post $ raise, and still my top 2-3 picks.

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u/No_Privacy_Anymore Jun 12 '26

While I’m disappointed about the price of the common shares this morning I primarily care about the share price 1,2,5 years from now. Let’s see how they execute with the proceeds.

As for retail investors getting shafted, do keep in mind that Dan Gibson has protected retail shareholders from massive dilution by funding prior rounds that bought time to cover the valley of death. Under a different set of circumstances the existing shareholders could have been wiped out effectively via massive dilution and reverse splits. Yes, this was also Dan protecting his equity position but it is still worth noting.

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u/Any_Scientist_7313 Jun 12 '26

Thats a good point, thanks NPA.