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Where did you hear that. They can raise

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eddy2   Thursday, 07/19/18 12:08:59 PM
Re: MasterBlastr post# 6537
Post # of 6553 
Where did you hear that. They can raise revenue and refinance existing capital and they can sell tax debt. There is lots of options without adding additional debt.

Let’s look at one in particular tax debt. They have a pile of old casset movies they sell on $.10 on the dollar of the purchase price. I’m keeping this simple.

So $.90 is depreciation of that you have a tax credit of $.15 cents.

You also have a tax debt of $.01

The difference of the credit and the tax is $.14. You can raise $.16 of revenue at a cost of $.01

The revenue is raised by selling the tax credit and the debt. The debt is then paid leaving a share holder deficit of $.01.

Now of course there is share holders dilution at 50/50 so not all is a gain for existing shareholders cause now the spoils must be shared.

Simply put add your treasury stock plus your share holders deficit because the tax bill has been paid and divide it by two. Take that figure and minus the market cap of the issued equity. That is the potential up side.

I say potential cause it’s still a liability attached to it because of other possible revenue raised on equity finance along with the spending of those funds raised. In other words you need new tax debt to take advantage of a tax credit offered.

Many would argue well the company has paid plenty in revenue tax’s in the past. The past is the past as governments look at things. They have based the dollar value of the country on past performances not future performances.

They call it a catch 22.

Now how do they get past all the debt and sell new equity too raise additional revenue. Well they can issue convertible bonds held by institutions who hold the shares in street name. This figure is always noted as the book value on your monthly statements the up side if any after dilution is your share holders deficit relative too the recievables and long term debt.

Do your own DD the numbers don’t lie.

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