As we approach the closing of the highly anticipated MGO Global (MGOL) and Heidmar merger, investors are closely evaluating the potential value of the newly formed entity. Based on my calculations, I will break down the share structure, estimated valuation, and projected stock price for the combined company.
Share Structure & Ownership Breakdown
The merger will result in the creation of a new company with the following share distribution:
- Heidmar Shareholders: 53,540,219 shares (94.34%)
- MGOL Shareholders: 3,212,413 shares (5.66%)
- Total Shares Outstanding: 56,752,632 shares
With this structure in mind, we can estimate the potential stock price based on the expected market valuation of the new entity.
Projected Stock Price Based on Market Cap
If the new company is valued within the $300 million to $400 million range, we can determine the stock price as follows:
- At $300M valuation: $300,000,000 ÷ 56,752,632 shares = $5.28 per share
- At $400M valuation: $400,000,000 ÷ 56,752,632 shares = $7.04 per share
3:1 Exchange Ratio - A Key Consideration
A significant factor in this valuation is the 3:1 exchange ratio, not the previously mentioned 30:1 ratio. This means that for every 3 shares of MGOL, investors will receive 1 share of the new entity. Adjusting for this ratio ensures accurate expectations for the post-merger stock price.
Evaluating the Minimum Value Based on Sale Price
Let’s assume a $18 million sale price and apply it to the revised share distribution:
- Total MGOL Holder Shares (adjusted for 3:1 ratio): 3,212,413 × 3 = 9,637,239 shares
- Stock price based on sale price: $18,000,000 ÷ 9,637,239 shares = $1.86 per share
Using this baseline, we can infer that the lowest reasonable valuation for the new company would be around $105 million ($1.86 × 56,752,632 shares). However, given the broader market valuation expectation of $300M–$400M, the more likely stock price range should be $5.28 to $7.04 per share.
Final Thoughts: What to Expect on Tuesday?
As trading resumes post-merger, we can anticipate that the stock price will be no lower than $1.86 per share and could potentially reach up to $7.04 per share, depending on the market’s response.
I currently hold over 125,000 shares, and at a minimum exchange price of $1.86 per share, this represents a significant valuation. For those monitoring this merger, next week will be a pivotal moment in determining how the market truly values the new entity.
Stay tuned, and let’s see how the numbers play out!