Friday, May 18, 2018

Dutch Star One guesstimate of intrinsic value per ordinary share


Dutch Star Companies ONE

Dutch Star One is Other People's Money (OPM). The company sold stock without owning anything. With the proceeds of the stock offering minus expenses, it hopes to buy a Dutch private company and the shareholders of Dutch Star One will then own that company.

Until that happens Dutch Star One is not a compounding snowball, but a melting ice cube.




Rough math:

Initial Public Offering (IPO): 5,5 million shares sold for €10,30 per stock is roughly 5,5m x €10,3 = €56m and €55,4m according to the website: https://dutchstarcompanies.com/

Outsiders could not buy "special shares", they were given to insiders for their work and iniative. There are 200k of these x €10 = €2m cost.

Expenses of setting everything up, administration, etc. is estimated to be around €2m (€1,75m on the site?).

So if we take €55m invested minus €2m + €2m expenses, you get €51m value.

€51m/5,5m ordinary shares = €9,3 per share. The stock price has dipped recently from €11 to €10 per share, if it goes far under €9,- Dutch Star One could be a buy, even if it hasn't bought a company yet.

Note: I am a novice and haven't done much work on this. I could be wrong.

Comments, questions or E-mails welcome: ajbrenninkmeijer@gmail.com

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