***Something Big Is Happening At SPCL***
Something big might be about to happen with Solaris Power Cells Inc (OTCMKTS:SPCL). The company is a shell on the OTC, but for the past six months, markets have been waiting for an update as to the progress of a potential reverse merger involving Solaris and digital media company, PixelMags. The merger first hit press when Solaris filed an 8K back in May, detailing the capital structure and management reshuffle implications of the action.
Since that filing, however, we’ve heard nothing with regards to progress. This is by design.
The two companies agreed that any information or announcement would come by way of PixelMags, not Solaris, and that the latter hasn’t filed any fresh Ks falls in line with the suggestion that this merger is happening. The question is, when, and what does it mean?
Well, as mentioned, it could be massive for Solaris shareholders.
For the purposes of this discussion, forget Solaris. The value for shareholders is going to derive from PixelMag’s operations, and the implications of these operations for the resulting entity’s market cap. By way of a brief introduction, PixelMags describes itself as a content creation and distribution company. This seems pretty vague, but its model is far simpler than the generic description suggests – it basically takes print format magazines and turns them into digital versions across various operating systems and viewing platforms (mobile devices, desktop browser etc.) It makes its money from the actual reformatting of these print publications (on behalf of the publishers) and also through the various channels a traditional print publication might generate revenues – ads, a cut from unit sales, content creation services etc.
Digital magazine space is set to expand dramatically over the next ten years, with some analysts projecting $35 billion by 2020, and PixelMags is very much at the forefront of the industry. It’s competing directly with native platforms such as Apple Inc. (NASDAQ:AAPL)’s Newstand, and it’s winning.
And it’s this fact that makes what’s happening at Solaris so interesting right now.
Solaris’s current market capitalization is a little over $20 million, with the company trading at just $0.01 a share. Even at this price, however the company is up more than 3,500% since late August. The reason that the company has run up so much is that, during 2015, PixelMags recorded $48 million, up from $30 million during 2014. Assuming a similar growth rate between 2015 and 2016 (and in this space, it’s conservative to assume a constant rate of growth), 2016 revenues should come in at circa $77 million.
In other words, Solaris is going to go from a $20 million shell generating no revenues, to a company with $77 million annual sales, essentially overnight. The implications for its PPS are substantial, if not entirely clear.
Exactly when the announcement will hit press remains to be seen – and that’s the primary risk here. Even with this uncertainty, however, the risk is minimal. The recent spike in volume suggests that any announcement is just around the corner, and an uplisting to a major exchange will almost certainly soon follow. There’s going to be some capital structure changes post merger, and again, the uncertainty surrounding these play into primary risk, but the potential reward vastly outweighs the risk, given the facts surrounding the merger.
The takeaway here is that PixelMags has basically bought the SPCL ticker and is using it as a route to the NASDAQ. In turn, SPCL shares right now offer an exposure to a NASDAQ company, generating high double digit million dollar revenues, in a rapidly expanding space. And they do so at the price of an OTC shell.
We will be updating our subscribers as soon as we know more. For the latest updates on SPCL, sign up below!
Something big might be about to happen with Solaris Power Cells Inc (OTCMKTS:SPCL). The company is a shell on the OTC, but for the past six months, markets have been waiting for an update as to the progress of a potential reverse merger involving Solaris and digital media company, PixelMags. The merger first hit press when Solaris filed an 8K back in May, detailing the capital structure and management reshuffle implications of the action.
Since that filing, however, we’ve heard nothing with regards to progress. This is by design.
The two companies agreed that any information or announcement would come by way of PixelMags, not Solaris, and that the latter hasn’t filed any fresh Ks falls in line with the suggestion that this merger is happening. The question is, when, and what does it mean?
Well, as mentioned, it could be massive for Solaris shareholders.
For the purposes of this discussion, forget Solaris. The value for shareholders is going to derive from PixelMag’s operations, and the implications of these operations for the resulting entity’s market cap. By way of a brief introduction, PixelMags describes itself as a content creation and distribution company. This seems pretty vague, but its model is far simpler than the generic description suggests – it basically takes print format magazines and turns them into digital versions across various operating systems and viewing platforms (mobile devices, desktop browser etc.) It makes its money from the actual reformatting of these print publications (on behalf of the publishers) and also through the various channels a traditional print publication might generate revenues – ads, a cut from unit sales, content creation services etc.
Digital magazine space is set to expand dramatically over the next ten years, with some analysts projecting $35 billion by 2020, and PixelMags is very much at the forefront of the industry. It’s competing directly with native platforms such as Apple Inc. (NASDAQ:AAPL)’s Newstand, and it’s winning.
And it’s this fact that makes what’s happening at Solaris so interesting right now.
Solaris’s current market capitalization is a little over $20 million, with the company trading at just $0.01 a share. Even at this price, however the company is up more than 3,500% since late August. The reason that the company has run up so much is that, during 2015, PixelMags recorded $48 million, up from $30 million during 2014. Assuming a similar growth rate between 2015 and 2016 (and in this space, it’s conservative to assume a constant rate of growth), 2016 revenues should come in at circa $77 million.
In other words, Solaris is going to go from a $20 million shell generating no revenues, to a company with $77 million annual sales, essentially overnight. The implications for its PPS are substantial, if not entirely clear.
Exactly when the announcement will hit press remains to be seen – and that’s the primary risk here. Even with this uncertainty, however, the risk is minimal. The recent spike in volume suggests that any announcement is just around the corner, and an uplisting to a major exchange will almost certainly soon follow. There’s going to be some capital structure changes post merger, and again, the uncertainty surrounding these play into primary risk, but the potential reward vastly outweighs the risk, given the facts surrounding the merger.
The takeaway here is that PixelMags has basically bought the SPCL ticker and is using it as a route to the NASDAQ. In turn, SPCL shares right now offer an exposure to a NASDAQ company, generating high double digit million dollar revenues, in a rapidly expanding space. And they do so at the price of an OTC shell.
We will be updating our subscribers as soon as we know more. For the latest updates on SPCL, sign up below!
