Thanks for the heads up. Can you please provide details of the warrants. I had a quick look at their SENS but found nothing for 2020.
So 4Sight still has around 4 Million Dollar of deferred vendor liabilities. The profit warranties have been achieved so they will get settled by issue of shares. The issue price will be the 30 day weighted average before auditors give approval. So I think this will be April. Currently the 30 day average sits at around 25 cents. So I think that at the end of this month or next month another 280 000 000 shares will be issued.
What does that mean for us: (After disposal of Digitata)
- Equity will be increased by 4 Mil. So total Equity will be at 25 Million. New issued share capital will be around 780 Mil shares. So NAV per share of 0.032. 58 cents.
- Tangible NAV will increase from 0.004 to 0.008. So tangible NAV will be 14 cents
Why I'm still invested:
- New management will be the largest shareholder so they have a personal interest to drive up the price. They are really competent.
- Basically no debt and a strong balance sheet with high levels of cash
- Strong cash flow generation.
- The remaining business generate an EBITDA of around 5 Million Dollar. Which value the company at around 40 and 50 Million Dollar. Or between 700 and 900 Million rand.
- Strong growth opportunity going forward and they got rid of all subsidiary which stopped a clean audit opinion.
So overall I still see great potential and finally they do not have stones in the way that hinder the growth.
Again this is only my personal opinion and no advice to buy or sell any shares.