My Numeric Attempts
These are whatever numbers I focused myself on, and the reason for which I'll say no. Can't recommend anyone else to take the numbers for facts, as I'm not really good with calculators. Tigris or Sheriff or whoever can feel free to point out where I go wrong, since I'm neither a mathematician nor an economist. I'd love to hear how this really is a good deal. I looked at Wolfpack's SEDAR:
- Wolfpack attempts financing October 2012, IPO. $0.60 per unit with 1/2 warrant included. Failed.
- Wolfpack financed September, 2011 at $0,40
With their 29,965,000 shares, the market caps are:
- $17,979,000 at $0.60/share
- $11,860,000 at $0.40/share
- $8,540,025 at $0.285/share
Tigris consolidate 3 old shares for 1 new one and their market price is $0.095 cents, so presumably the new share-price would be 28.5 cents. Tigris on July 31, 2012, had $8,740,178 in cash and 59,798,250 outstanding shares. No warrants to speak of. Yet, at $0.095 cents, they're trading at $0.05/share below cash-value instead of the $0.145 cash-value that's in the treasury. Tigris real price is $0.145, not accounting for properties, with no warrants or debt, and so on.
We issue Wolfpack 29,650,000 shares at 28.5 cents on closing. Wolfpack's estimated value in this deal should in my mind be thought of as $0.435 cents because Tigris trades at 65 cents on the dollar and as we're providing Wolfpack with dollars, I adjusted for that, the market cap at $0.435 cents is $12,897,750. No more than I believe Tigris is not worth 9.5 cents do I believe that 43.5 cents is what Wolfpack's worth. What is Wolfpack worth? I've got no idea. Nobody wants to tell us. Except the market that thinks it's not 60 cent with 1/2 warrant. I can get to 43.5 cents and say that no, I don't like that for a company with $811,000 in the treasury at a market where companies struggle for financings. I know what it will be worth without a capital injection: next to nothing. I can wait.
Moreover, I could say I don't like this because Wolfpack has a mix of options, issuance of shares on anniversaries, and royalties that are too much for me to sit and calculate on and figure out where the fully diluted number of shares and net-profit on oz/gold would be to end up in a best-case scenario. They have pitiful grades. I thought I read "high-grade underground" gold somewhere, but I couldn't see any. This is an awful deal according to how I see deals - we're the ones that should be taking advantage of Wolfpack Gold, and we're not. Our money will at the rate of Wolfpack's pace burn pretty quickly (1-2 years, I guess) unless they produce some fantastic news on the way.
Again, I welcome management or anyone to point out (kindly) where my numbers are wrong, explain what the full dilution would be after Wolfpack's all options and issuance deals previously made, where this high-grade gold is (0.25g/t is not high grade), and alongside with correcting my calculations, provide a justifiable share-price for Wolfpack.