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Microcap & Penny Stocks : POKR - Casino Air - Real Gamble? -- Ignore unavailable to you. Want to Upgrade?

To: zookeeper who wrote (436)	9/24/1998 12:03:00 AM
From: blash	Read Replies (1) \| Respond to of 609

Zookeeper...As I forewarned you, my strength is not in accounting, but nonetheless I'm not sure your analysis is correct. If AVIA share price = POKR, then about 28.7M shares will exist for the merged company. How likely is this is anybody's guess but I have reasons to believe that the AVIA value may increase before the merger. However, if we, in fact, have 28.7M shares then it seems to me that you need to add the assets that both companies bring into the equation before dividing by the total share count. The $12M conversion price, I believe, has been used simply as an instrument to calculate the share worth for POKR currently. It doesn't mean that there is $12M available if the stock were liquidated. I agree that the $2.10 strike price for the Jos Charles warrants portends good things for the merged company's stock value. Remember, however, when this merger was initially negotiated, AVIA's price was about 3.75, very close to the $4 price needed for Nasdaq Small Cap listing which has always been a goal. My guess is that the 2 companies felt that the merger would be received well in the investment community and they anticipated an upward tick in the AVIA value. Well, this didn't happen for multiple reasons and now the AVIA/POKR alliance is trying to promote the new company in an attempt to bolster the price. I know that it is still their goal to attain Small Cap listing and reason would only dictate that Jos Charles, an investment banking firm, would do everything they could to help promote the company to create value in their warrants. However, it is to the advantage of Jos Charles to not help out until after the merger, since if the AVIA price escalates, they would get fewer warrants. So my guess is that they will jump in and help out after the merger is completed. This seems like a lot of detail for something I perceive more simply. AVIA is a company with millions in assets and no debt. It is merging with a company that showed $1M profit last year and is on course to make more this year and projected to a have 40% increase in profitability in 1999. AVIA has recently acquired two more companies and is looking for more which should all add to the bottom line since the formula that Forhan uses only considers profitable acquisitions. I look at these facts and wonder how these two companies, AVIA & POKR, can be trading at the present low levels. I wouldn't be surprised if some, perhaps a majority, of the decline is due to naked shorting. This is quite common for bulletin board stocks since more than 90% of these companies fail. I am confident that this company won't, but it is sometimes difficult to wrest the stranglehold that some shorters have over a company. Sorry for the long-winded post. A lot of stuff was on my mind.