RE:RE:$2.6mln in cash + $2.5mln in MCLD shares It's $2m (USD) cash on close + 1.5m shares of MCLD (current value roughly CAD$500k) + up to 3.5m more shares dependent on undisclosed performance-based milestones
According to the last investor presentation, approx 46% of their Agnity investment had been returned in cash up to Mar 31. The total Agnity investment was about USD$2.8m (initial $2m + promissory note of 750k + interest that was later converted to further royalty).
So on the US$2.8m investment they'll receive a total of US$3.4m cash + between 1.5m and 5m shares of MCLD.
I'm happy to see them crystallizing some cash, which should be up to $12m after the PP and this sale. But I'm curious why they've made the move. The cash-on-cash return is well below target. Need cash for big investments coming, or getting ready to deal with the debs in some way? (partial tender for instance?)
The Agnity royalty paid approx $500k per year according to the mCloud release, based on revs of $6m. Seems like a bit of a cash cow and worth more than $2m if you have a positive view of Agnity's business.
I know nothing about mCloud aside from 20 mins of digging around this morning. It appears to be one of these overly-promoted venture stocks. They pay Stockhouse for advertising, which has always been a big warning sign to me. They issue a tonne of PR and repeatedly use lots of buzz words (IoT, Big Data, AI, Machine Learning, Blockchain). A few of the CEO's previous ventures have ended badly -- lots of VC money raised and burned.
I also can't figure out what the hell mCloud is talking about in their PR regarding the deal. It strikes me that they're buying a royalty interest only, yet they are talking about synergies and consolidating revenues etc as if this is a merger. Very strange. I'm missing something.
Could be tonnes of upside in the equity but the real deal here is