...when I listened to the April 1st BGC Partners conference call by CEO Lutnick. During the Q&A session, Lutnick stated that the contingency for BGC to receive the $484 million in earn-outs payable in NDAQ stock over 15 years is that Nasdaq OMX Group has to earn at least $25 million in annual revenue. (For those who don't already know, Nasdaq OMX Group's revenue last year was $3.12 billion!)
The incredulous analysts couldn't believe their ears! They kept asking Lutnick to explain what the contingency is, over and over again. So Lutnick explained it again slowly, but they still didn't believe it! They kept asking Lutnick to go over it again. It was hilarious!
I can't wait to read the revised analyst reports once they are released. One of the analysts remarked that the reason they had never attempted to do a "sum of the parts" analysis of BGC Partners is because they never dreamed that Lutnick might be open to selling off some of the parts of the firm.
Yes, I also laughing when Howard Lutnick kept saying "Let me repeat it to you very slowly....." to the analysts over and over. And the analysts just couldn't believe their ears. $25 million in annual revenues from NDAQ OMX group as a whole- This is a contingency? It seems like a sure thing to me. I'd take this bet any time and go all in any day. Howard Lutnick is a very smart guy, and BGCP really did get the better deal by far in my opinion.