Thus adding 60% to that valuation would result in an estimated value of $47.7 million to $136.5 million for Torchlight's oil and gas assets. This opinion was rendered in mid-December 2020, and oil and gas assets have generally increased in value by an estimated 50% to 60% since then. It came up with a valuation range of $29.8 million to $85.3 million for the oil and gas assets. Torchlight hired Roth Capital Partners to provide a financial opinion on its proposed arrangement with Metamaterial.Īs part of that opinion, Roth estimated the value of Torchlight's oil and gas assets. A million shares out of 524.8 million shares would be the same as 100,000 shares out of 52.48 million shares. With Metamaterial currently valued at approximately $313 million (based on 106.5 million shares outstanding at $2.94 per share, it is uncertain how much the combined company will trade for post-business combination, but if it maintains the same market capitalization, that would result in a price of around $0.60 per share.Ī reverse split wouldn't change shareholders' ownership percentage in the company, though. While there are no plans to do a reverse split before the business combination, there is some potential for a reverse split sometime after the business combination if the stock stays beyond $1 for an extended amount of time. This would result in the combined company having 524.8 million shares (based on the March 18 information), composed of 145.3 million for legacy Torchlight shareholders and 379.4 million from Metamaterial shareholders exchanging into Torchlight. Source: Torchlight Energy - Schedule 14A - March 23 Each Metamaterial share would be exchanged for 3.563 Torchlight shares in this example, resulting in Metamaterial shareholders getting 379.4 million Torchlight shares. Metamaterial had 106.5 million shares outstanding at that time. As of March 18, Torchlight had 145.3 million shares outstanding. Torchlight's filing shows how the shares will be allocated after the business combination. One reason for the decline may be that Torchlight's SEC filings include an estimated combined value for the oil and gas assets and Metamaterial's business that is still lower than Torchlight's current share price. Torchlight's stock has declined a decent amount over the last few weeks.
It currently needs to give notice of the related stockholder meeting by April 15 and hold that stockholder meeting by May 10. Torchlight Energy Resources ( TRCH) is getting closer to the time of its proposed merger with Metamaterial ( OTCPK:MMATF). Photo by luchschen/iStock via Getty Images
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