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Does the research note have forecasts?

I suspect that the real reason is that they couldn't get the funding, not that they changed their mind

Two things, they haven't issued the shares yet and the price they're issued at is meaningless. Mylky sellers are getting £6m in cash, £3m in loan notes and c 400m shares. The shares may be issued at 0.77p, or frankly even £1 but they are worth whatever the market says they are. If I were the vendors i would think I'm getting £6m solid money, and £3m with some credit risk attached and 400m shares which are currently worth c£0.8m. Now I might then think these shares should be worth a lot more so I'm very happy to have them; or I might think they're a bit of icing on top which may or may not be worth something but I'm happy with my £9m for my two year old start up.

Completely agree. There is a research note out today from Oberon but there are no forecasts in it.

https://oberoninvestments.com/research-and-events-portal/#/portal/oberon-capital/research/4ffe83ae-67b2-40cf-b894-f0795fcdddac

Can you tell us what the forecast revenues and profits are?

"may take time and that some complexity will remain" - that's a bit worrying

The share issue in the deal is a red herring. Mylky will be issued with, say, 467m shares at 0.64p. That will give them 17.6% of the enlarged group and at 0.64p that equates to £17m market cap. (that's as close as I can get to making their numbers work. However the price issued is irrelevant. They could issue them at £1 a share if they wanted to. The real point is that the shares are worth, say, 0.22p, so the equity consideration is worth £1m. Mylky know that but they're getting £6m in cash and another £3m in loan notes which they would do well to discount too.

While there is a superficial similarity - both in health foods - there is a world of difference between making plantain crisps and a £120 machine for making oat milk. Mylky will be a third of the revenues and two thirds of the EBITDA. And Tooru will have £13m of debt and a market cap of £6m.

Mylky is a very young business - it only started two years ago - and on the face of it is very successful it seem strange that they want to sell themselves to Tooru on less than 4x EBITDA for this year. Perhaps they think they're going to take over the business once inside and this si a cheap way of getting an AIM listing.