So what you have is an established private company of over 25 years that is buying a shell of a company and putting their business (metals) into the shell. This is called a reverse merger.
So how do I know the value of the stock will jump considerably???
1. Management agrees to pay off the debt in exchange for shares at a cost of .0001/share (market value). Why would they pay off debt to receive shares at .0001 when that is the market rate? Because they know the value of the shares in upcoming weeks.
2. The new company that emerges will be debt free, have no legal encumbrances, and will completely shed the management of the old company (one person remains for 60 days to ensure continuity of business). The true value of the company will be 100% based on the new company and 0% on the old company.
3. If Scepter Commodities, LLC chose to do an IPO instead of a reverse merger, a company such as this would be valued based on it's own financials. By making the shell clean as part of the deal, the same valuation will occur for pennies on the dollar (ipo's expensive). Find a company on nasdaq that has no debt, no legal encumbrances, and is profitable for under a buck. I know of a few, but not many.
4. A 100:1 r/s would bring the o/s to somewhere in the neighborhood of 150 mil shares. If the stock goes to even .30, that would be a 3000% return on investment. Would you invest in a profitable company with no debt and no legal problems for .30/share? I would. So would the old management. They spent $1.6 mil and paid retail price too just to clean up the books.
