Hi J.R., I think it depends on how large the private entity with which CVIA is working.
Consider this scenario:
If CVIA, as a shell with some assets, is "valued" at... say, $1 Million in a merger scenario (I'm just applying a "guess" there), and let's say the private entity was valued at $5 Million (again, just an example).
CVIA has 55 million shares outstanding. So essentially we would be saying 55 million shares = $1 million in this scenario.
If the private entity is worth $5 million, then, theoretically, it would be fair for them to have 5x55 million shares. But CVIA only has 100 million shares authorized.
In this scenario, CVIA would need to reverse split about 2.5 to 1 so the private entity could get a fair deal.
But as you can see, the bigger the entity, the higher the reverse could be.
For CVIA investors, it means that instead of a big piece of an almost empty shell, we would have a smaller piece of a BIGGER pie that has a FAR stronger opportunity of growing.
Of course, the important thing is the "strength" of the private entity.
Keep in mind, this is just a scenario. And it is MY assumption of how things COULD occur. Everyone should do their own research and do only what is comfortable for themselves.
Best wishes,
Brad |
