Emblem Corp EMMBF

How Does the Math Play Out?

[fixer8888888888]

I've got an email out to IR from Aleafia for clarification, but in the meantime my take is that if shareholders vote this merger in, we as existing shreholders will get .8377 shares of the newly merged company.  The value of those restructured shares is based on the closing price of ALEF on December 18 whcih was 1.44 so essentially we will net 1.21 based on the premium Aleafia is paying to complete the transaction.  EMC closed at .95 on the 18th.

Therefore if someone was holding 10k shares that would convert ot 8,377 shares which would equal a cash value of $10,136.17..........Anyone agree with my understanding or am I missing something?  If you had to sell any portion of those shares, the true value of course would be subject to the stock price of the newly formed company.

[ArthurVandelay]

Yes, you are quite right.  It's an all share deal,  so the stock price right now doesn't mean much.  You get 0.8377 shares of ALEF for each EMC share you hold.  So yes, 10K of EMC shares gets you 8,377 shares of ALEF. AV

[thekgs68]

In order to explain this I will give 2 scenarios, both involving acquiring 50k shares of ALEF: SCENARIO 1) Go BUY 50k Shares on Open Market of ALEF 50k x $1.36 = $68,000 -$1.36 was ALEF close price today SCENARIO 2) Go BUY 59.688k Shares on Open Market of EMC 59.688k x $0.89 = $53,122 -$0.89 was EMC close price today -Conversion as per Definitive Agreement states each EMC share converts into

[okfine5]

there is no guarantee on what the alef price will be on closing.. So, there is a risk component with emc, therefore the lower value as per your calculation. OK

[thekgs68]

"Guarantee"?  Is that a joke?? No such thing, either in Stock Price or even if Deal goes thru.  Go buy a GIC then.  But converting EMC stock based on Monday close to ALEF, you're buying at a 22% Discount.  BUT more importantly I think there will be a competing Bid at some point in early January.   EMC is trading at roughly 75% it's Equity. 

[bobodolen123456]

when does the change happen,is it months away,still time for the stock to appreciate or are warrants worthless

[bobodolen123456]

noticed in the Invictus take out of Gtec,holders will receive a proportionate number of options and warrants of Invictus,not worded in our release ,but is it possible with such a large warrant houlding in EMC

[bobodolen123456]

can anyone answer my question on options and warrants,new to this game,are insiders not worried or do not lose out on options and warrants,hold 3 mil options and 1.2 mil warrants

[thekgs68]

The Deal values EMC at $173.2M.  At $1.21 per share, the equals 143.1m shares, which is 20+m more shares than per TSX website.   So I assume this includes “in the money” warrants and options

[Gbbuknowme]

do we have an anticipated date when this deal is finalized? thank you in advance!

[canaken1]

I am assuming the voting infomation to and from the share holders will take approximately a month. That should put us into the Feb. 2019 time frame. If there are counter bids its anyone's guess.

[bg8ts]

According to the response I got from IR, the existing options will be replaced with new options and the warrant strike price and expiry dates remain unchanged, except the warrant will exercise for 0.8377 Alefia shares instead of 1 Emblem share. Of course the offer has to first be accepted by 66.6666 percent of shareholders or the deal does not happen. With 80 percent shares held by retail

[thekgs68]

Upset or not, the only reason this Deal doesn't go thru is becuae there is a better Deal than what is currently on the table from ALEF. And I can't belive this is trading here, what an absolute steal!  For each share of EMC you buy today you're buying ALEF right now at $1.05 vs ALEF actually trading at at $1.40 now.  LOL

[Sasha.Nik]

On warrants strike and expiry unchanged, does this mean Alefia SP has to hit $1.75 and higher for the EMC.WT to be exercised into 0.8377 of Alefia shares?? Does that makes sense?

[canaken1]

If the deal goes through, and strike and expiry of the warrants are unchanged, yes it makes sense for EMC.WT to be exercised into 0.8377 of Alefia shares as you have stated.

[cronos22]

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[Hopeful]

Hello , I own this stock and uncertain what to do so I'm researching as much as possible. What does everyone think about this? https://www.marketwatch.com/press-release/aleafia-emblem-merger-creates-canadas-largest-network-of-clinics----cfn-media-2018-12-21

[stockboy52]

I posted a similar question on the Alef bullboard. Look at ALEF & EMC post. Comments were good and informative. Some think it is a bad deal for EMC owners, others think it will make both companies stronger and more competitive down the road.

[stockguy655]

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[cronos22]

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[fixer8888888888]

Revenue streams, vertical integration, consolidation, frustration, followed by agitation, and last but not least and at some point when your wife finds out you've spent the rent money, CASTRATION!! Seriousely though, once revenue streams start rolling, we will IMO see numerous Canadian pot companies emerge as global leaders in the industry, which on a global level is expected to be in the

[Buddeh]

So if the numbers stand today, we should be buying a sht ton of EMC and make easy money when converted to ALEF. Im surprised not many people are thinking this way yet. Im assuming the SP will rise to match the conversion value, once we see more proof of closing.  And if the deal fails then the sp will rise eventually anyway if the company can continue being successful.  Agree or

[MrOptimization]

I agree and disagree with your sentiment. I could see Alefia questioning why they are paying more than required given the current deterioration in the market for marijuana stocks, combined with the continued deterioration in stock price for Emblem. I also see the margin play being a quick win, even if you want to buy it and sell it once it converts to an Alefia share. There is a risk though that

[Buddeh]

Yeah, we should watch closely as more news comes out about the merger. I might take a stab at some more shares today and probably will see the conversion give some quick money there. Because really, the sp not being in proportion to the merger ratio values, doesnt make much sense to me. Only risk really is that ALEF and the market drops drastically. I supposed thats possible, but talking strictly