Good morning. I have decided to share this analysis I wrote up on this transaction. I only have ever tried to discuss the facts here, and dispel blatant non-truths. I've never told anyone to buy or sell. I initially wrote this on June 19th, and several things have been confirmed.
Rushnet, Inc. & HeliosDX Merger Analysis
Currently, RSHN is a publicly traded stock going through a reverse merger transaction with plans to execute two spinoffs, resulting in 3 separate companies. It is important to understand that until the entities are separated, they are all nestled, and therefore valued under the one ticker, RSHN, in terms of share price.
Richard Goulding of Rushnet, Inc. using his vast network as a physician, brought in HeliosDX, the merger candidate, to give value to RSHN shareholders. HeliosDX is a fast growing diagnostics company focused on Behavioral & Urine Toxicology, Infectious Disease, and Allergy using less invasive blood droplet cards. The company has enjoyed rapid growth in revenues from 1.7 million dollars in 2018 to 2.6 million dollars in 2019, 4.3 million dollars with an adjusted EBITDA of 1.3 million in 2020, and an expected 6 million dollars in 2021. Expected to close around September or OCtober 2021, the company has a binding letter of intent to acquire an additional lab that would result in a projected revenue of $25 million per year. Two other labs are being targeted as of that announcement, and updates will come once Pink Current. HeliosDX conducts its business using some high-powered vendors or business-to-business partners, if you will, such as Cardinal Health (medical device and specimen shipping), ThermoFisher (medical device provider), Verb (medical sales platform), and GoRev (Patient management platform). Verb, ThermoFisher, and Cardinal are all nasdaq companies. HeliosDX is already contracted in nearly every state, which means a national presence is already established in advance of the recently announced and upcoming national sales campaign with Verb.
HeliosDX has a sister company called Grandeza Health Consultants. In its inaugural year, it already operates with $1 million in annual revenue with $30,000 in profit, and is growing alongside HeliosDX, who is its biggest customer. Rushnet, Inc. will merge with Grandeza Health Consultants, bringing instant added shareholder value above the original Rushnet, Inc. entity. This may or may not happen before HeliosDX is officially trading on an exchange. That is not clear, but Grandeza will basically be the entity with the current share structure, unless there is an announcement of share retirement or buyback (at any time). Hopefully Mr. Sweat can still prevent a R/S when we get to this point. But you have to understand it could come back to the table, but at this point you will be getting or already have free shares about to be trading on the Nasdaq with Helios, and a company with OTCQB calibre, looking to uplist to Nasdaq in Grandeza.
The former Rushnet, Inc. entity has $60,200 in Joint Venture assets, or “shared financial interests'', primarily with its sister company Gold River Production Services, Inc.. Included in that, are royalty agreements for its ventures with BIEI, HALB, LeGanja Fairy, and Able Academics. All of these JVs are medically focused in hemp, cannabis, and naturally healthy products or health and human services initiatives (ie. helping Veterans avoid toxic medicines, scaling a profitable school nationwide tailored for autistic children, anti-addiction patch and other natural remedies to combat the opioid epidemic and promote products that fight big pharma). If any of those ventures become successful, the original Rushnet, Inc. stands to receive income from that. The old Rushnet, Inc. also is a shareholder of STNT alongside GRPS. Goulding is the chairman of the board of STNT and GRPS. Learn more by following GRPS. Rushnet, Inc. also still has an open trademark application for Knockout Punch, a CBD beverage that was put on hold because of FDA stance on CBD in foods. Unfortunately attempts to acquire funding proved difficult, and Goulding always vowed to not risk going against the FDA, so something needed to take place and Goulding transferred his preferred shares of RSHN to Sweat, effectively putting Sweat in control of all further decisions regarding all 3 companies.
Rushnet, Inc. will file a Form 1-A Tier 2 Regulation A Offering, that will register and list shares of HeliosDX on an uplisted exchange (OTCQB or Nasdaq) with a target AS of 40 million, and a likely OS less than that. This depends on many factors, such as the current RSHN share structure, pps, and how many shares are bought at discount, at the time of effective date or the day it starts trading. The offering will specifically state that it is exclusive to RSHN shareholders and that they will get 1 HeliosDX share for every 1,000 shares of RSHN as a one-time stock dividend (this will take place on its own through brokers, and show up in your account). The Form 1-A will also state that RSHN shareholders can buy up to 11 more shares for every 1,000 at a discount to the new price (uo to 50%, but eventually determined at the time of the 1-A application or cut-off date, based on the same factors above). The discounted shares are also handled by a broker. All of this is done per SEC rules. HeliosDX will become SEC reporting.
The original Rushnet, Inc.
At any time, or potentially subsequent to the previous actions, Rushnet, Inc. will be spun off, or perhaps its assets will be purchased by GRPS, making it easy for Grandeza to stand alone and execute its business plan. Sure, Grandeza may have to deal with the share structure issue, but here is where I think Mr. Sweat has options, as he could spin off grandeza into a new company like Helios, or reduce shares and seek to uplist within the OTC, and proceed to spin off the old Rushnet, Inc. assets.
Now that we have discussed the 3 entities under RSHN, let's take a look at an example using the same variable of .01 pps with 2 different shares held amount:
Stock Divided for RSHN Shareholders if you hold 10,000 shares at .01:
10,000 shares of RSHN = 10 Shares of HeliosDX
Cost was 10,0000 x.01 = $100.
Market Cap of RSHN at .01 is $77.6 million (7.76 billion shares x.01 = MC)
With a MC at $77.6 million, and only 40 million outstanding (77.6m / 40m = $1.94), your HeliosDX value would be $1.94 x 10 shares = $19.40
With 10,000 shares you would be able to buy up 110 more Helios shares at up to half off. That would be a discount of $106.70 (1.94/2 x 10 shares = $106.7)
Stock Divided for RSHN holders (10,000 shares) when price increases to .05 before the dividend date
Lets say RSHN goes to .05 in the interim, you will have gained $400 (10,000 shares x .04 increase in pps)
At .05, the new RSHN MC is $388.2 million, therefore the prospective price of HeliosDX share based on 40 million outstanding would now be $9.70 x 10 shares = $97. (388.2m / 40m = 9.70) So now, at .05, you have now gained $400 in value of the original stock, and you get $97 worth of new separate HeliosDX stock, another free $100 in discounted shares (with gain to buy-in), and haven’t even considered the potential of Grandeza and the old Rushnet entity to grow beyond .05. Now you are at 5 times your money, plus free shares in HeliosDX, and the EXCLUSIVE OPTION to buy HeliosDX at up to half the price. At .05 your discount is (9.70/2 x 110 = $533.50)
What if Rushnet, Inc. or Grandeza buys back 3 billion shares (at any moment) than our .05 shares rocket even more.
Stock Divided for RSHN if you hold 1,000,000 shares at .01:
1,000,0000 shares of RSHN = 1,000 shares of HeliosDX
Cost was 1,000,000 x .01 = $10,000
Market Cap of RSHN at .01 is $77.6 million (7.76 billion shares x.01 = MC)
With a MC at $77.6 million, and only 40 million outstanding, your HeliosDX value would be $1.94 x 1,000 shares = $1,940.
With 1,000,000 shares you would be able to buy up 11,000 more Helios shares at up to half off. That would be a discount of $10,670 (1.94/2 x 11,000 shares = $10,670).
Stock Divided for RSHN (1,000,000 shares) when price increases to .05 before the dividend date
Lets say RSHN goes to .05 in the interim, you will have gained gained $40,000 (1,000,000 shares x .04 increase in pps) (Value is now $50k)
At .05, the new RSHN MC is $388.2 million, therefore the prospective price of HeliosDX share based on 40 million outstanding would now be $9.70 x 1000 shares = $9,700. So now, at .05, you have now gained $40,000 in value of the original stock, and you get $9,700 worth of new separate HeliosDX stock (matching your initial investment), and haven’t even considered the potential of Grandeza and the old Rushnet entity to grow. Now you are at 5 times your money, plus free shares in HeliosDX, and the EXCLUSIVE OPTION to buy HeliosDX at up to half the price. At .05 your discount is (9.70/2 x 11,000 = $53,350)
In my opinion, if GRPS could acquire all the assets of RSHN ($60,200), that would make it less confusing for everyone who really wanted to invest in a hemp/CBD Beverage company, and Rushnet, Inc simply becomes Grandeza, and there is less confusion.
I hope this analysis helps anyone who is not clear on this opportunity make the best decision that they can for their investment goals. This is no longer an OTC stock floundering in development stage. This is a nasdaq bound company with its nasdaq bound sister in tow, using a less conventional method of becoming a public company.
Thanks to Richard Goulding & Ashley Sweat for bringing this amazing opportunity to RSHN shareholders.
Written by D-Money6 on IHUB / @USA_603 on Twitter.
I am not a financial advisor, and this is not financial advice. I am long RSHN. This is all my opinion and my own interpretation.
