This is the only line item that is relevant to CDCH. I think it’s fairly clear that Cerro will revert to a simple holder of 5% of AMC. Nothing more or less but with a little dilution for whoever will be replacing the existing BOD. Seems like this is the inevitable direction we are going.
With 273M shares at .003 we are trading at a $820k Market Cap…This would be the equivalent of each percentage of AMC being worth $164K or AMC’s private value of $16.4M. Based on what we know today (not a lot), I would assign a $15-$30M valuation to AMC today but there is a TON of upside if they find what we all hope and produce what we believe is possible.
Based on these numbers could CDCH be a 10 bagger from here? It’s not hard to see AMC’s being worth $164M at some point down the road. Can CDCH get back to 10 cents? That would require a $500M valuation for AMC. Also possible but the results would need to be phenomenal. We have no indication of how this will play out and, unlike many others, I still believe there is significant geo risk. If there wasn’t, there wouldn’t be the significant upside potential.
As a point of reference MDMN is trading at $600k per 1% of AMC or a ($60M private valuation). There is clearly an arbitrage opportunity if/when visibility on CDCH improves.