The purpose of an IPO is to generate capital. Joe
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Posted On: 07/31/2020 1:24:33 PM
The purpose of an IPO is to generate capital. Joe said he wants initially $50 million for NGIO. According to the10Q https://www.sec.gov/Archives/edgar/data/10597...orm10q.htm the total NGIO shares are 750 million, 350 million as treasury stock (shares) and 400 million as outstanding. “As of April 30, 2020, 400,000,000 shares of NGIO are issued and outstanding of which 38,357,038 shares belong to non-controlling interest shareholders which represents a 9.59% non-controlling interest.” Shares we got free as a dividend payout. GNBT owns the rest of the stock. If the IPO is set at $5, only10 million offered shares would be needed to generate the $50 million capital. With shares sold from the 350M treasury, the non GNBT shares increase to 48+ million. The important thing will be; NGIO will be a public company, NGIO will have $50M in capital for developing their initiatives, and we will have stock liquidity.
If my above reasoning is correct, then NGIO will still have 340M treasury shares to sell for future capital and GNBT will have, on paper at $5/share, $1,808,214,810 worth of NGIO stock. I would think that with this much paper value, the GNBT price should rise to at least NASDAQ qualification. This should be no different than as if an intuitional investor (Vanguard, Blackrock, etc.) held the NGIO stock. Side thought/question; with NGIO not being a subsidiary of GNBT but an independent company, could GNBT infuse NGIO with additional capital, if needed, with money made by selling some of NGIO shares they hold? Obviously GNBT could raise capital by selling some of their NGIO position.
It looks to me that the role of Oasis Capital https://www.sec.gov/Archives/edgar/data/18045...form8k.htm in the IPO, is to insure that a $5 minimum share price is maintained by buying up to the $50 million need for the NGIO capital infusion. Since I have never dealt with “futures”, how the “puts” calculations in the Oasis agreement is a mystery to me. So the earlier statement could be completely a misunderstanding on my part.
If my above reasoning is correct, then NGIO will still have 340M treasury shares to sell for future capital and GNBT will have, on paper at $5/share, $1,808,214,810 worth of NGIO stock. I would think that with this much paper value, the GNBT price should rise to at least NASDAQ qualification. This should be no different than as if an intuitional investor (Vanguard, Blackrock, etc.) held the NGIO stock. Side thought/question; with NGIO not being a subsidiary of GNBT but an independent company, could GNBT infuse NGIO with additional capital, if needed, with money made by selling some of NGIO shares they hold? Obviously GNBT could raise capital by selling some of their NGIO position.
It looks to me that the role of Oasis Capital https://www.sec.gov/Archives/edgar/data/18045...form8k.htm in the IPO, is to insure that a $5 minimum share price is maintained by buying up to the $50 million need for the NGIO capital infusion. Since I have never dealt with “futures”, how the “puts” calculations in the Oasis agreement is a mystery to me. So the earlier statement could be completely a misunderstanding on my part.
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