Private versus public

Discussion in 'Learn how to trade or invest by asking questions' started by adamwilson412, Jun 24, 2019.

  1. adamwilson412

    adamwilson412 New Member

    We are located in Australia and putting together a national food service distribution business by acquiring already operational businesses with strong financials and greater than 15 year trading history.
    Once under our control each business allows a limited number (400) of the customers currently using the service to buy into the business they are helping to build.
    Their buy in will give them access to shares share of the profits and group discounts.
    By having our end user's part of the business we will increase our sales revenue dramatically.
    The final part of this process is to reverse merger onto the ASX, with the increased revenue and earnings multiplier from private to public brings it will bring all our investor partners a great windfall.

    My question is would you invest in this if $10,000 gave you 100,000 shares at listing limited to 200

    Would you invest in this if $10,000 gave you 50,000 shares at listing limited to 200

    What could be added to give a level of confidence for investment

    What pitfalls do you see to the process

    Has anyone carried out this type of venture before.
    Cheers Adam
     
  2. Blaine Tarr

    Blaine Tarr forum leader won penny contest 24x won weekly contest 20x

    Rather than asking retail investors, you should find a qualified Venture Capitalist with legal counsel versed in ASX regulations so you don't run into any issues when trying to reverse merge onto the exchange.

    Total share count doesn't compare to the % of the company.
    What percentage would each investor have?

    Why would you ask 200 investors to pay $10k for 100,000 shares vs asking 200 investors to pay $10k for 50,000 shares.

    In my honest opinion: You're setting yourself up to be a penny stock forever with a share structure of this nature. I would avoid this deal until many more details are known.
     

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