OTCPK:RKNLF - Post by User
Post by
JonathanJSmithon Dec 13, 2016 8:28am
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Post# 25590385
RKN got what it could...
RKN got what it could...Think about it.
If you look at their latest report, consider the balance sheet in particular.
Once you subtract the true value of Goodwill and Intangibles from their assets, they have a NEGATIVE equity of about $36MM!
So, getting an infusion of cash of $80MM into a company with a book value worth NEGATIVE $36MM is actually a benefit to shareholders. Constellation bought $46MM worth for $80MM - frankly, they're the ones who got suckered.
Now do you see why the current big investors agreed to this deal?
Unfortunately, existing shareholders got duped because they drank the coolaid the CEO was selling - Joe Q. Public always takes it upstairs w/o the KY.
They are targeting $15-$20MM EBITDA for the year - pretty crappy if you ask me. Once you factor in all of the required payments, etc., their bottom line will be close to zero. Sadly, with luck, they'll be able to generate some cash during the year. Nonetheless, it will still take several years (if and) before they can get back on their feet.
Consequently, minority shareholders can expect absolutely nothing from this company going forward. Constellation now owns the BOD and, in essence, the company.
However, consider at the bright side; if you sell now, you at least get something.
JJ