Southridge Enterprises Inc (SRGE)

[stervc]

Willforeall & ALL, as for possible buyout options...

The post I made below reflected how 100% of the valuation for the Cinco Minas mine is worth over $5.7 Billion:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81538747

However, we know that the major NYSE company that will be the one to buyout the Cinco Minas mine from SRGE is not going to pay the $5.7 Billion premium price. The premium price would be over $10.00+ per share considering the current SRGE OS of 545,874,868 shares. It is likely that they would be paying a discounted price versus the premium price of which we are not aware of. There are a few ways to derive a variety of amounts that would make sense through logical deduction.

You stated a "what if" on the premise of $1.5 Billion going towards the buyout of the Cinco Minas mine. You then asked how such would reflect on the price per share (pps) here with SRGE if such a deal were to happen with $1.5 Billion being the amount. I believe that there are a few ways of which the buyout could be executed of which all would bode very well for us SRGE shareholders. Let’s further analyze this based on a $1.5 Billion buyout as you have considered with these ”four” options below:



Option #1 = All $1.5 Billion in cash remains with the company:

Under this option, all of the $1.5 Billion would remain with the company. Based on the SRGE OS, that would ”add” Equity to SRGE worth approximately $2.74 per share (Derived by $1,500,000,000 ÷ 545,874,868 shares). We as SRGE shareholders would indirectly benefit from the expected increase in price to take place from this huge cash infusion into SRGE. It wouldn’t mean that SRGE would necessarily trade at $2.74 per share, but who knows… it could. With this $1.5 Billion cash infusion into the company, such $1.5 Billion would be approximately its new Market Cap. The current Market Cap of SRGE at today’s price of .0074 is $4,039,474 based on its current OS. You can divide $1.5 Billion by $4,039,474 to see how many times SRGE is undervalued based on today’s price. From doing the math and if such a buyout would happen right now at such price… SRGE would be approximately 371 times undervalued in comparison to today’s price that yields its current Market Cap. That would mean that based on the Market Capital Analysis, SRGE would be worth…

371 x .0074 = $2.74 per share



Option #2 = All $1.5 Billion in cash is awarded to SRGE shareholders:

Under this option, all of the $1.5 Billion would be given to SRGE shareholders in the form of a cash dividend or a cash distribution as I have seen some companies call them. From the info above, from doing the math, that would mean that current SRGE shareholders would be awarded $2.74 per share in cash. This means that if you bought 1,000,000 shares of SRGE at today’s price of .0074 per share, you would be spending $7,400, but would get $2,740,000 (1,000,000 shares x $2.74) placed into your account in the form of a cash dividend or a cash distribution.

The beauty about this is that you would still be keeping your 1,000,000 shares for future gains as SRGE matures or deal their other properties of equal or greater value.

Further, here’s ”the concept” that might be more beautiful to understand about this option. If you buy one share of SRGE at $2.74 per share, you would be guaranteed to get 100% return on your money. Investors would clearly see that a new bottom of $2.74 per share would still get you 100% return on your money again while still keeping your shares of SRGE. To further understand just how powerful this is, below is a further expansion of a chart to see the pattern…

** If you buy SRGE at $2.74 per share, it guarantees a 100% gain from the $2.74 cash dividend.
** If you buy SRGE at $5.48 per share, it guarantees a 50% gain from the $2.74 cash dividend.
** If you buy SRGE at $10.96 per share, it guarantees a 25% gain from the $2.74 cash dividend.

Now keep in mind, currently SRGE is at .0074 per share so I think you see the power of what could happen as explained above. Also keep in mind that it’s not totally out of the question in my opinion because with the company owning a good amount of shares as I presume, it would be like the company paying themselves along with paying us. They could take their shares and multiply them by the prices above to understand that taking this route would be a win-win situation for us all. I actually like this option the best.

To further understand just how powerful this option is, instead of using $1.5 Billion as you have considered, just divide those amounts above by 3 to get what the per share amount would be considering $500,000,000 as the buyout amount. And I must say that although I think $1.5 Billion would be fair… as a minimum, $500,000,000 would be very fair for an amount of property that is valued to be over $5.7 Billion… but that’s just me.



Option #3 = Part of the $1.5 Billion remains with the company & the rest to shareholders:

Under this option, it’s like a combo of both Options #1 & 2 above. The company keeps a certain amount of the cash to enhance the Equity within the company as in Option #1 and then awards to SRGE shareholders what’s remaining in the form of a cash dividend or a cash distribution. Under this option, we would not get the full $2.74 as I had explained in Option #2. We would get an amount much smaller, but would have a combined effect of both Options #1 & 2 above.



Option #4 = 50% of the $1.5 Billion is awarded in cash & the rest is awarded in shares of the NYSE company:

I could come up with a variety of percentage ways to explain how this option would work such as the company keeps all of the NYSE company’s shares or awards them to us SRGE shareholders while keeping the cash or not keeping the cash or etc. I think you get the point. I think it will be very interesting to see exactly what they will announce for more details to help with seeing if this option in full or this could make for a very long post.



Again, I must reiterate that the beauty about SRGE and having a major NYSE mining company buyout their Cinco Minas property is that it will allow us as shareholders to still keep our shares and be in position to ”double gain” versus only having a single gain.

If this was going to be an ”entire buyout of SRGE” then we would be losing our shares in exchange for what would be given for the buyout. Since it is only the Cinco Minas being bought out, then the ”double gain” would exist because we would still capture the value, either directly or indirectly, of the Cinco Minas being bought out plus we keep our shares to allow for further benefit from growth to exist from the remaining SRGE properties with our same original position that allowed us to benefit from the Cinco Minas being bought out.

Keep in mind that the news was great, but upcoming news at some point will be even greater because it will have…

** ...the name of the NYSE company.
** ...the amount per share or a total amount so that shareholders will know the worth.
** ...the amount of proceeds to be given to shareholders; 0 or .10 or .20 or etc.

One final important piece to note is that the buyout PR below indicated that…

…One of the firms has already signed preliminary documents for the full acquisition of the Cinco Minas property. …
http://ih.advfn.com/p.php?pid=nmona&article=55016708

In my opinion, we are very close to some very major and positive achievements from SRGE that will be made known to all of us within the market.

v/r
Sterling