Sky isn't falling but it's raining shares
If you read the last two quarterly reports you can back into the size of the potential investment in Juneau. It will get a little complicated due to the cross ownership of Juneau into PRED but basically PRED needs to come up with a ton of cash to fund further purchases that will bring ownership in Juneau up to 40% provided that Juneau doesn't further dilute its own capital structure.
On Sept 30, 2017 PRED owned 11.885% of Juneau through LifeCode
PRED had the option to convert Juneau debt into equity which should have been a further 10% stake per the notes to the F/S in September.
Except when PRED converted the $3,685,308 on the notes (P&I) into Juneau Class A units at $1 each the total holding in Juneau only increased to 17%.
This appears to indicate that Juneau issued additional units during the period to other investors. PRED's stake only increased by 5.115% not the 10% that was disclosed previously by PRED mgmt in the Sept F/S.
Dividing the 3,685,308 units acquired by 5.115% gives us approximately 72 million units for Juneau (granted this will be off slightly as the initial PRED stake was also diluted).
So 17.25m into the 72m is another 23.9% that PRED can buy. Add this up you get to 41% or so but we need to back some out as Juneau actually owns million of shares of PRED. So let's call it 40%.
If you read the notes you will see that PRED can pay $18.975m for this additional piece of Juneau. This puts a value on Juneau of around $80m as they are not going to give PRED a bargain price.
Now this may have real value in the future but PRED has negative cash flow from operations so any payments made will need to be funded from capital transactions. No one will provide straight debt to PRED so the funds will come from share sales or less likely convertible debt.
The going rate for PRED shares on this basis seems to be 50 cents and in any event is certainly $1.00 or less based on all the past shares, warrants and options issued.
Basically this is a long winded way of saying I can't understand why anyone would want to pay the current market price for even 1 share of PRED.
Roll the price back to where it was before Big Sal started the hype over the new Patent and maybe you have an argument but to me I think even that is a stretch.
