Astika Holdings Inc (ASKH)

[Renegades17]

My take on this process

Richards has talked to this company for 4 years (correct me if I'm wrong), so the two sides know each other very well at this point. The target's best path to going public is through the reverse merger. The ability to go public should have enormous value to the target's owners and Richards (through Astika) should be compensated some for that. It would cost the target a fair bit to hire an underwriter, pay legal and accounting fees (though an audit is happening, so perhaps that's a wash) and market an offering. This also ignores the time risk associated with that process as anything could happen in the markets. If the target's owners are looking for liquidity, this seems like their best option.

My base case is that Astika shareholders should be rewarded with $10-$12mm in value, which is a $0.33-$0.40 share price. That assumes a $40mm valuation for the target, which I bet is one of the items they're negotiating over now (and engaging a third party valuation firm to conduct an analysis, which takes time and may be dependent on audited financials). Perhaps it's worth more, but we haven't been given much information.

I certainly hope I'm low balling as I own a lot of this, but I think my base case is reasonable assuming the deal goes through.