I think that they are getting on the book as shares are issued,...
Wait a minute, are you sure about that? I think they already put out the assumption of current and future issued shares already on the books, even though they haven't yet booked the asset. Look at the yahoo (Market Guide) profile, which presently indicates 20.8 million shares are outstanding (versus ~13 million last year), and compare that with TowerSemi's recent 20F below (using my formatting for explanation purposes):
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IC Tech…………………………………...9.6 million shares (+)…….47% of class
Alliance Semiconductor Corporation…….2.7 million shares (++)…...14% of class
SanDisk…………………………………..5.4 million shares (-)……...24% of class
Macronix…………………………………2.7 million shares (+++)…..14% of class
Capital Group…………………………….1.4 million shares ….…….8% of class
(+) …this includes a minimum of 0.7 and a maximum of 1.8 million shares yet to be issued Pursuant to a Share Purchase Agreement.
(++) …this includes 1.1 million shares issuable Pursuant to a Share Purchase Agreement.
(-) …this includes 1.1 million shares issuable Pursuant to a Share Purchase Agreement, and 2.7 million shares issuable upon exercise of a warrant (http://www.siliconinvestor.com/readmsg.aspx?msgid=16284126)
(+++) …this includes 1.1 million shares issuable Pursuant to a Share Purchase Agreement.
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Now consider carefully…the above share count totaling 21.8 million shares, which is in fair agreement with yahoo’s (Market Guide) number, includes the remaining shares to be issued pursuant to the Share Purchase Agreement , but the asset (i.e., ‘the Fab’) that is to result, in part, from that agreement has not yet been booked. The consequent result is that an incredible marketcap valuation disparity relative to Tower’s future book value, will exist if Tower’s share price remains at current ridiculously low levels.
You see, after all of the above shares are issued, at the current stock price, Tower Semi’s (TSEM) future marketcap is $196 million (should the stock price remain at its current price<g>), but they will have a state-of-the-art $1.1 billion asset sitting on their property.
At what point do you think the $1.1 billion asset…will get put on the books? The question I really wish to ask is at what point does the stock market begin to discount this $1.1 billion asset that will eventually be appearing on the books of a $200 million marketcap company?
Cheers,
thecalculator |
