Dr Gas
1.At this point, and let's be VERY clear on this, FCCN has NOT ACQUIRED THEM. They are at the most preliminary of talks.
2.LOIs (Letters of Intent) in this arena are meaningless. I've seen another stock in the pinks come out with similar kinds of PRs, (see my sig) and then retract the information later, by saying that "the company has decided to pursue other avenues." All the while never naming the nameless acquisition target. But Letters of Intent are just forward-looking pieces of paper, filled with "after due diligence" and other language meant to give the "acquiror" lots of outs.
3.Clearly, IF it is FCCN's plan to go through with an acquisition of Dr. Gas here, there are questions of means to acquire and value of Dr. Gas. Seeing as the current shareprice is under .01, let's look at the things we have read and see if we could gauge just how this would occur.
Let's say the 3 million in revenues is right. Not unreasonable that the cost to acquire is AT LEAST equivalent to that. That would be 300 million shares. Now, we know that isn't ever the case. Likely going to be, as were other arrangements in the past here, a discount of large proportions. Let's use 50% based on the price of .007, shall we? So that would be a .0035 price, and let's go on 3.5 million to purchase. Welcome to 1 billion shares more. If purchase is at a 2 times revenues proportion, it's 2 billion shares. At that point, O/S would be close to 4 billion shares. Here's the kicker. The better the financials for Dr. Gas, the higher that multiple. IF they are truly profitable, that multiple is going to be higher than the available shares. Hence the sudden need for a reverse split "in order to complete this transaction and build a synergistic relationship," yada yada yada. That split will be large, and then the shares issued for the purchase will essentially make this company theirs. Oh, and Hunsaker's and Peacocks when they cash in their money due to them.
Now let's say that the financials for Dr. Gas aren't so good...that the revenue number is the same but that they lose money and don't look likely to become a profitable endeavor soon. Sure, the cost to acquire is less, but like Aero, you get another money-burner to add to a company that doesn't have money to burn.
Everyone's speaking like they know Dr. Gas's financials and that this is a done deal. Except the company, who is putting so many forward-looking CYA caveats in their email correspondence (topped off by the writer being too scared to put their name to the email) that you can't tell up from down.
Buyer beware.
IMO/FWIW
"Taking advice from known stock promoters is like telling a pickpocket where you keep your money!!!"
