Refocus Group Purchase

Just a quick update, I want to let you know that I purchased 1,700 shares of Refocus Group (RFCG.OB) stock on Friday for my son’s Coverdell ESA.

Refocus Group is planning to go private by conducting a reverse share split where 2,000 will become 1 share. Anyone holding less than 2,000 shares will be cashed out and receive $0.35 for every share held just before the reverse split. The details of this transaction can be found in the SEC filings listed on my going private transactions list.

You might wonder why I’m only buying 1,700 shares. Well, I have only enough cash in the Coverdell ESA to purchase 1,700 shares. If I had more cash in that account, I would have bought 1,999 shares of Refocus Group stock. As you might recall, I did buy 1,999 shares of Refocus Group for my Roth IRA last month.

One last note: if you decide to purchase one of these small companies that has stock symbols ending in .ob or .pk, you might need to drop the dot-ending when entering an order with your broker. For example, when I purchased the Refocus Group stock, I used the stock symbol RFCG, and not RFCG.OB, to enter in the purchase order.

11 thoughts on “Refocus Group Purchase

  • July 24, 2005 at 8:35 am

    Just curious as to why you are buying RFCG 9and others) before the definitive proxy has been filed and accepted. I have noticed that in most instances the price does not jump much afterwards and the likelihood of the deal being done is much more likely after the def is out. Are you that sure the deal will work?

  • July 24, 2005 at 7:37 pm


    It is a good idea to wait until a definitive proxy is released to purchase stock in a company that is going private. However, I have not always found it easy to actually purchase the stock after the definitive proxy. It has often taken several days for my limit orders to be executed for some of these small thinly traded companies. Price is not the only issue; volume is also important in getting in on these deals.

    In addition, waiting for a definitive proxy to be released does reduce some risk, but the only stock that I’ve had a problem with cancelled their going private transaction after they released a definitive proxy.

    I am never sure that these deals will work out, but the small risk of them not going through is offset by the significant profit margin that many of these deals have. I think the risk reward ratios for many of these deals are pretty good, but you have to make sure that you are diversified to ensure that the odds work in your favor.

  • July 24, 2005 at 7:57 pm


    Thank You for a thoughtful answer.

    You say that the odds work in your favor. In your experience you also state that you had one that did not work.

    Two questions.

    1)How many did work? How long have you been doing this?

    2)Is there anything one can look for in the preliminary proxy to weed out those that have the most liklihood of not working? …rather than just randomly buying every going private.

  • July 28, 2005 at 9:59 pm

    George: great site and very intriguing plays!

    Have a question regarding your “Going Private” list. For the ones you listed as “Broker Held Shares: OK” I assume that I don’t need to worry about how the stock is held.

    For the ones you listed as “Stock Class: Street Name” or “Stoch Class: Recorder Holder”, what is the difference? Does it mean we could only play the ones labeled “street name” unless we contact the borkerage firms to change the record holder to my own name?


  • July 30, 2005 at 10:24 am

    “Broker Held Shares: OK” means that “street name” holders (i.e., stocks in a brokerage or bank account) will be treated the same as “Record Holders”. You are right to assume that you don’t need to worry about how the stock is held.

    I will be converting all the “Stock Class: Street Name” to “Broker Held Shares: OK” in the near future to avoid confusion. They are one in the same. I decided to start using “Broker Held Shares: OK” to make it more user friendly and understandable.

    Entries labeled “Record Holder” will require you to contact your broker and ask them to register the shares in your name. I’m not that familiar with that process. I know it can take up to a few weeks and costs an additional fee. I hope that helps.

  • August 9, 2005 at 8:12 pm

    inv relations said sec approve by this month…then 20 days after the vote it will be good to go…dont think having only a prel proxy is a big deal in this case ..especially given return

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