Early this week, before Demand Media released its amended S-1 registration statement (S-1/A), I wrote a piece describing what a $1.5 billion IPO would look like compared to a $1.5 billion acquisition. However, that was based on nearly twice as many shares being assumed outstanding, since the amended registration statement (filed today) notes a “1-for-2 reverse split of common stock.”
In the simplest sense, that means that if you were planning on a $9 to $12 per share offering price previously, you would now be looking at an $18 to $24 per share price range. Or, if you held warrants with a strike price of $6 per share they would become warrants with a strike price of $12 per share. In both cases, it’s worth noting that the target price range would still be above the penalty rate for the Series D shares ($7.73 minimum offering price before the reverse split and $15.82 minimum offering price after the reverse split).
Also, the original post assumed that all of the shares would be original issue shares, versus shares offered by selling shareholders (secondary sales). The current registration statement indicates that 40% of the proceeds will go directly to selling shareholders. This, of course, means the market cap will be slightly less, since fewer shares will be outstanding.
Here’s a revised payout table of how an IPO, post split, would look like at $1.5 billion versus an acquisition at the same price for certain holders.
|
IPO@ $1.5B |
M&A @ $1.5B |
|
|
Founders |
$18.47/Sh. |
$15.9/Sh. |
|
Lance Armstrong |
$18.47/Sh. |
$15.9/Sh. |
|
Tyra Banks |
$18.47/Sh. |
$15.9/Sh. |
|
Enom Investors |
$18.47/Sh. |
$16.56/Sh. |
|
Goldman Sachs |
$18.47/Sh. |
$18.88/Sh. |
At Culture, Religion & Tech, take II in Miami on October 29, 2024
Read more...
Bambi Francisco Roizen
The company will use the funding to broaden the scope of its AI, including new administrative tasks
Read more...
Steven Loeb
The company will be deploying Qventus’ Perioperative Solution to optimize its robotics program
Read more...
Steven Loeb
Startup/Business
Joined Vator on
Demand Media is building a different type of new media company. With a proprietary media platform that powers the company's highly-trafficked domains and wholly-owned content media properties, Demand Media leverages cutting edge, user-driven publishing, community and monetization tools in its quest to define the next generation of new media companies.
Startup/Business
Joined Vator on
Since founding bpCentral, our focus has been on increasing each user's competitive advantage each and every time they interact with one of our applications. Naturally, this involves more than simply enabling complex calculations to be performed accurately. In fact, during the first 12 months of developing our new technologies and applications, we put an inordinate amount of resources into discovering how to transform the relationships between idiosyncratic decision-makers and financial information. Our premise was that if that human to data relationship could be elevated to a new standard, then the relationships of those professionals with the entities and individuals they interact with could be more efficient and therefore more valuable.
In response, we developed CIMPA, the Carver Import Algorithm, a system that allows any electronic financial information, data or reports to be interpreted by a receiving system without the need for XML, XBRL, tagging approaches or extensive manual data entry. As a result of this technology, the Company's systems for private equity and venture capital professionals are able to import data in a matter of seconds, instead of a matter of hours.
Similarly, the Company noted that when users attempted to calculate the outcomes of complex liquidation preferences, anti-dilution provisions and other complex terms that are common to VC/PE transactions, any output was virtually impossible to verify without a costly audit of the formulas. Since the formulas were generally based in excel, this meant that few if any partners or other key investment professionals could afford to expend the effort to verify how amounts were arrived at. Upon further consideration, the Company realized that, to a certain extent, this was true of all financial reports. For traditional financial statements, this point is evidenced in the fact that notes to financial statements typically occupy several times more pages than the actual financial reports do. This realization inspired the Company to develop a system it calls OferX, which presents all financial information in a manner that allows any user to audit and see how amounts were calculated (in an easy to understand, quantifiable manner) without the need for extensive textual descriptions.
Together these unique tools form the foundation for the Company's offerings, which are backed by over 29 patent pending technologies.
Joined Vator on
Joined Vator on
