THE NEW PNC TELECOM

martincoops

If it's OK with you could we stick to one subject at a time and not change mid flow? We were discussing the fully diluted net asset value per share, which is derived as follows:

1. There are 143m shares currently in issue and the NAV in relation to them is £482k, see interims here:



2. The acquisition will result in the issue of 287m shares for something that has a NAV of only £125k, see:



3. And finally 530m shares are going to be issued, which will increase the NAV by 0.1p for each share, ie a further £530k (that's right 530m shares are going to be issued at a mere 10% of the current share price).

4. Hence the fully diluted NAV per share is:

( £482k + £125k + £530k ) / ( 143m + 287m + 530m )

= £1,137k / 960m shares

= 0.118pence per share.

which compares to a share price which is 10 times that figure.

5. Now bearing in mind that trade finance companies rarely trade at more than a small premium to NAV (since trade finance is an inherently risky business rewarded with very tight margins) then on the back of a fag packet the PNC share price would need to fall by about 90% for it to be close to fair value.

Could you state clearly your agreement with 1 to 5 please?

regards

JakNife