Reply from PTEL (they are quick)
Dear Mark
Many thanks for your email.
In response, the new company will issue 138M shares to existing shareholders of Petel Incorporated at a strike (issue) price of £0.75 ($.150). This means there will be 138million shares x $1.50 issued, giving an issuance value of $207M.
Therefore, if you hold 100,000 shares in Petel Incorporated at the date of record you will receive a dividend of 100,000 shares in the newly acquired company, with a strike value (value at issue) of $150,000. That is 100,000 shares x $1.50pps.
This is in addition to your current Petel Incorporated Holding.
If you were a shareholder in the newly acquired company you would receive Petel shares as your dividend. As there will be 5 million outstanding shares in the acquisition at time of completion, Petel Incorporated will issue 5million shares to the shareholders in the newly acquired company. This amounts to a 3% dilution of Petel Incorporated in return for the $207M stock dividend.
We hope this clarifies your understanding.
Best Regards,
Investor Relations
Petel Incorporated
Hello,
First off, thank you for a most interesting investment.
I would like some clarification, if possible, on the acquisition announced yesterday.
When I view the strike price of US $1.50 for the 5M shares of the company to be aquired, this means a total value of $7.5 M, which, when spread out over 138M Petel shares would yield a value of .055/shr.
Yet, the PR uses a total valuation of $207M for the 138M shares to be awarded as dividends to existing PTEL shareholders.
Am I to believe that the dividend shares will be worth US $1.50 at the time they are awarded?
I have read the PR several times and given the current valuation of PTEL stock the $207M does not make sense to me.
I hope you can clarify this.
Thank you and GO PTEL!!!
MVC
AI
