Mentor Capital, Inc. (OTC Markets: MNTR) has entered into a $32 million letter of intent with a rapidly growing Health Care I.T. company currently servicing medical practices in over 20 states. Upon execution, the acquisition of $32 million of the Health Care I.T. company shares will increase Mentor Capital cancer and medical assets 330% to $42 million. Mentor has approximately 3 million shares outstanding. Although that implies $14 in medical and cancer assets per share, Mentor notes that at current prices, after allowing for the warrant exercise dilution afforded by financing the purchase, the medical assets may calculate to approximately $3 per common share.
Until the complete funding contract is negotiated, the parties have agreed not to identify their partners. In a letter to shareholders describing the investment, Mentor Capital CEO Chester Billingsley writes, “We are very positive about the growth and multiple acquisition prospects for this company in the Health Care I.T. sector. I am also impressed with the quality of their management team that has the unique hallmarks of entrepreneurial success.” After contract approval Mentor intends to hold a conference call to introduce this important new financial association.
Overall, this third investment would continue the trend of a 4,000% increase in company holdings from $1 million to $42 million in four months. It also keeps Mentor Capital on track to meet the stated management goal of acquiring an average of $10 million in medical or cancer related assets per month, which would fully allocate Mentor’s $125 million in warrant proceeds by year-end.
With some candor, Billingsley comments, “We often mention and are most proud of our socially responsible investing to develop a possible cancer cure and reduce the cost of health care. However, looking toward $42 million in assets and trailing earnings per share of $0.17, versus a recent closing bid price of $0.14 per share that implies the value for all of Mentor is $450,000, perhaps ‘undiscovered high-growth company’ may be the most important description of us.”