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I am fairly confident that MOGP wont be "buying" the spin offs, at least not with cash. Shares will be issued in MOGP to be given to ORPH shareholders in exchange for the spin off. This will create dilution in MOGP, but MOGP will immediately be worth £200m+ so the SP wont necessarily crash. Speculative punts in MOGP are based on there being a net gain for the existing shell, so despite any major (and likely inevitable) dilution, the SP still rises.
I expect dilution later (post spin off) to raise cash, whoever will provide the finance.
I for one am not too concerned if a 50 fold dilution from today ends up resulting in a 1p share price. It will mean a gain from today's prices.
I also expect FOMO to take over as, in the case of immutex, the assets could be hot property and thus the value of the overall MCAP may exceed the net assets value of the spin off.
Any would be investors need to acknowledge that this is a speculative punt. As trader mentioned, there are many unknowns, but CF certainly knows something, and enough to buy 5%
Thanks for your thoughts Max
Thanks Dingodog.
Also a good point about OO only a shell a while back.
I wonder if CF will become more involved in MOGP in the future?
As the way I see it:
A) There will not be a raise at these price
B) As part of a reverse take over there will be significant underlying assets or business backed into #MOGP to underpin the the transaction and as a result, #MGOP will see a significant increase in value.
C) with new government rules that will encourage SPACSthis like other SPACS will have a significant increase in value in the market because many businesses both in UK and Abroad will search SPACS out as it has many financial advantages.
D) this company is already listed and will again attract a much larger market
E) Look at the recent TR-1's there is a lot of money coming into what would otherwise be a cash she'll.
Also, look at the new director's and this tells me that #ORPH is either only part of the picture or not part of the picture, but if it is there will be a significant partner and they will likely put up the money, so if there was to be dilution, it will be to sticky hands and would likely be a very Mr/Mrs Big and as such will attract more money in due to the partnership and/or the underlying asset value!
So, anyone posting doubts seems to be a subtle deramp and cross ramp that won't have the same potential as MOGP IMO, but as everything this is a punt, but at these prices it is. Steal nd is likely to have a sharp reuse on share price.
I think the main reason people are making speculative punts in MOGP is that CF (via investment co) has invested to acquire 5% of MOGP.
Dilution is inevitable, but dilution isnt always bad. If the shares in issue quadruple but the MCAP 5 bags (for example) then the ground floor MOGP buyers still gain.
A lot of the buying here is following CF taking a position and the expectation (hope) that he wouldnt do so at a detriment to his own wealth
That's how I see it Trader. The value is with ORPH, they hold the asset. However, there maybe more than one asset here. It's worth a small punt. Lets be honest, ORPH was a shell until they acquired Venn and Hvivo.
Hi Trader.
That is one of the things baffling me. When the shares from MOGP are handed over to shareholders of Orphan - this will be surely after the fund raising and subsequent dilution ! So by holding Orphan shares you have the benefit of Orphan, the subsequent free shares in MOGP BUT at a share price that reflects the new company and after any dilution.
But what is confusing me is that Orphan will then get paid the ( lower) diluted share in the free 1-1!
The worst that could happen is that things go mental, mm's struggle to keep up and we make more money than expected on this ount- it's Friday!
ORPH = Low (known) Risk & High Reward
MOGP = High (unknown) Risk & Unknown Reward
If MOGP subsequently incorporates Imutex or other non core assets, my understanding is that CF has stated you will receive free shares via your ORPH holding in any case.
Maybe I’m over simplifying things, but by buying ORPH shares you will invest in a known & profitable low risk\high growth company and could also receive any potential upside in MOGP.
So why take the higher risk in buying MOGP?
Happy to be corrected in my assessment.
IMHO
I'm in!
It's Friday....what's the worst that could happen???
;-)
first time SPAC virgin here, i cant be the only one.
I'm slightly confused about who pays and when the share dilution kicks in ?
Am I correct in thinking that IF say Immutex was spun out of Orph, reversed into MOGP - then MOGP need to rasie money / dilute shareholding here....so to pay ORPH for the Immutex offering in shares? If so, BEFORE this could happen then MOGP will have to raise a humongous amount of money on the market, to raise say £40 million??? quid to a) pay for the 1 for 1 shares being provided to all Orph shareholders PLUS enough money they can use a s working capital to take Immutex to its next stage.
Therefore, todays shares in circulation in MOGP could be diluted massively.
So if at that time the MOGP share price has risen to 1p ( random guess) it will then be diluted heavily back to somewhere far below 1p.
I'm pretty sure this is not how it is suppose to work . What are the mechanics of a sp rise, vs the dilution in a shell that has just taken on a business for £££ amount.
Did CF mysteriously buy in to ORPH/HVIVO before the announcement? Or, was he introduced as and when the announcement is made?
If the former then it is possible we are in line for a repeat here, at least in the sense of CF taking a position in a "lost cause" right before a barnstorming tranformation
In for £1K will never learn
I'm in for £2k...
Imagine if you had got in Orph at 2.65p just before this cheeky RNS on the 10th May 2019.. That would be an 11 bagger right there and a long way to go...
https://www.lse.co.uk/rns/ORPH/conditional-acquisition-of-open-orphan-dac-09jl1ddr4xjut1r.html
haha good analogy Ted, and my thinking exactly.
Yes the share will change name automatically
Yeah, I've taken a small punt based on the ORPH connection...
A bit like when your favourite race horse trainer makes a last minute entry to a race with an unknown horse. I'm backing the trainer not the horse :-)
Only fun money so far - but have freed up a bit of capital (not from ORPH - that is locked tight) and will see what unfolds.
GLA - nice to have a bit of excitement here
The risk of dilution concerns the funding required to progress whichever non-core asset is spun off (assuming this is indeed the vehicle).
If this co becomes the immutex spin off, for example, then the dividend in specie from ORPH will ultimately transfer the IP, assets etc from ORPH to MOGP in exchange for shares in MOGP. It is well know that immutex will need a lot of funding to get it through the trials etc, funding that will come from dilution imo.
I dont have much experience in this type if situation, but if MOGP is a spin off vehicle then cash will be required in addition, whichever non core asset ends up making its way over (if any)
I'm in big with OO and my question is...if I buy in to MOGP will the share transfer into the new company after the name change. It's an obvious question I guess but need confirmation. Tia
They already know who there investing in , a joint dose of insider info and future based knowledge makes this board a very hot property.
Depends what the RTO is.
Based on this within an RNS..... Will there be a huge dilution if extra cash is raised?
"Following Completion, the Company has been designated as a Cash Shell pursuant to AIM Rule 15. As such, the Company must make an acquisition or acquisitions which constitute a reverse takeover under Rule 14 of the AIM Rules or be re-admitted to trading on AIM as an investing company under the AIM Rules (which requires the raising of at least £6 million) within six months failing which trading in the Company's shares on AIM will be suspended pursuant to Rule 40 of the AIM Rules. Admission to trading on AIM would be cancelled six months from the date of suspension, should the reason for the suspension not have been rectified."
Ding , nice post. ATB
Not a risk at all. You can take 50% profit shortly or wait until end of June and just look at the value of your holdings then.
Based on this......