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Augme Technologies, Inc. Message Board

  • sirius_yomama_2 sirius_yomama_2 Aug 4, 2012 8:13 AM Flag

    Spinning off HC is not a reality

    Ok so the recent posts have alluded to this "option" to address a value question from investor community. I sure as hell hope that we all realize this will never become a reality for Augme simply based on the fact that its absolutely a retarded idea. For one we just acquired the company and finished its integration. The AdLife platform is now HC products line after some software integration of HC's platform with Adlife. The VALUE of the new agume is in this integration. We now have 2 prong business model that will develop new capability via Augme's R&D, strong established sales channels via HC, and intellectual protection that raises the competitive wall and barrier to entry for competitors in the field. The creation of dual revenue stream from this combination is what makes Augme the future powerhouse of mobile/internet marketing. WHY WOULD THE COMPANY DIVEST THIS CAPABILITY????? Without HC we will be pegged an IP troll which makes it harder for us to win and get awarded higher damages.

    Lets call this for what it really is....a stupid unrealistic option.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • NP Tao. Human nature as usual. But you are absolutely right.The "real' issues discussed formally or not were the the substanative ones and clearly germaine to the companies long as well as short term goals. Good day to you. Mick.

    • Why don't we wait to see how AUGT will settle their cash position first - cause by my account they need to do something NOW...and thanks to the 3 amigos for the shareholder meeting report - I mean that...nice to hear Arena has a personality...changes my view ever so slightly about him...but actions do speak louder than words so...lets see what happens.

    • and based on management superconfidence at the shareholders meeting, I believe and this is just my opinion, that the terms of the financing will be very amenable to us.

    • When financing is announced....it's already secured I'd bet the house. This stocks pops a buck and a half...maybe two bucks real quick.

      When this company sees the first win in court.....the stock goes to 8 in two weeks. THe first week would be a gobbling up of shares by institutions getting them from weak three bangers...thus a hold on prices in the sixes for a bit. But week two gets it climbing again as wall street piles on.

      Says me.

    • I think most here would agree that it could be an option, but probably only if we can pull off some big victories in court. It could be icing on the cake to investors if we do win/settle in our favor with YHOO and AOL and stick it to VELT/MM. Look at GGP/HHC. I know it won't be exactly the same, but HHC did split from GGP after GGP ran from $.30 to $17, then HHC doubled. I understand the differences between GGP and AUGT, but could we ultimately be leading up to a deal like this, where AUGT's stock price ramps up on positive developments, then they spin off Hipcricket and give us a portion? Probably not, but that would be sweet. My understanding is that a spin off would increase AUGT's share price, but AUGT shareholders would not get any HC. This is ALL SPECULATION, but just sharing my experience with GGP/HHC, which was a nice investment.

    • I absolutely was not referring to you Sirius, I also agree that it will not happen.

    • sirius, why would any company take any options off the table that could potentially create value for its shareholders? Narrow-minded leadership in a company is a recipe for stagnancy or failure.

      Consider this scenario. Let's say somebody "big" makes a good offer for HC; it could be Oracle, FB, Amazon, Yahoo, or others as speculated on this board. It doesn't have to be now, but maybe 3-6 months from now, at say $500 million (a 14X multiple for a $35 million run rate). That does two things, with multiple side benefits.

      1. It instantaneously brings a huge $$ war chest into Augme, that it could use in a plethora of ways to generate more income; expand its patent portfolio for future licensing, pursue more licensing deals with potential infringers, pursue more lawsuits against infringers who decide to ignore licensing requests, slap injunctions on infringers to force settlements, acquire additional IP, acquire other synergistic companies, etc.

      2. Whoever buys HC would have major plans for fueling its growth (otherwise, why buy it?), and would have the cash to do so. Possibly HC could become that $1 billion company in a few years that would end up generating significant royalties/licensing fees for Augme.

      The result would be a secure future for Augme, with ongoing cash flow (at essentially no cost) from HC and infringers who buy a license, and also some potential settlements. What would Augme be worth under this scenario? Somehow I fail to see why that would be "stupid"? I think that could get Augme to its end game (a complete buyout) with more velocity.

      • 2 Replies to jason9153
      • siri, I was going to reply to back to you, but jason absolutely said exactly what I was thinking and feeling 100 percent. jason, that was really good!!! as was said in the movie" blazing saddles", " jason, you use your tongue better than a 20 dollar whore!"

      • Jason, I respect that point of view and it is definitely an option that management will have on their side "hip" pocket for sure. But let take your scenario...in 6 months we will be definitive be proud owners of a court win or couple of settlements with large enough award for past infringment to buildup our war chest for other direct competitors of company, my main concern, AND fund internal growth of HC to become that $1B+ company. Looking at the onset of internet in mid 90s to advertising realities of late 90s imagine what we can be in next 10 years with HC as the leader in the space. We could be the next Apple! Why be just a VHC that limitations in what they must prove in the court of law at risk of a jury hand for each case. If they lose the next battle guess what will happen to their stock price??

        I see a vision of real solid company with real product protect by their patents. Honestly its why I invest so much in Augme because the security of HC is there to protect bottom side if our patent suits were not as successful. At least we have a division that is growing tremendously and will be the next VELT at the minimum with real valuation on solid earnings. You don't want to be at mercy of the courts as company all the time as you very well know.

    • siri, I totally see your points and they are very valid and well taken. let me , if I may, play devil's advocate. based on the numbers that jason threw out with well thought accuracy, let's say they sell hipcricket for between 280 - 320 million. PLUS, PLUS, a very lucrative licensing agreement going forward. the licensing agreement with the company that buys us that will bring us between 50 and 100 million per year. stock price goes up 6 dollars overnight, immediate nasdaq listing.. I believe, based on management confidence at the shareholder meeting, that management believes aol and yahoo will settle. if that wasn't the case, they would be out of their minds to sell hipcricket now. they are not out of their minds.

      • 2 Replies to billysgift23
      • Billy,

        Even if we give a $320M valuation to HC and spin it off now it will not do us any good right now. Given what we paid for HC and all the integration costs it will not propel us any higher and in fact will most likely drop our valuation being without core business revenue. Then Augme will pure speculation play. I am not sure where the 50-100M per year is coming from but our licence revenue will have to come from a percentage of a revenue stream created by our IP....usually 1-5%. We know HC does not have $1B revenue for such royalties so I missing where this type of money is coming from from sell of HC.

        Now you can consider a sell ONCE you have couple of huge settlements or wins in the IP front to jump start licencing revenue from the Augme's side but then you have ask yourself WHY would you sell HC for $320, $400, 0r even $500M??? With a win under our belt we have validated our IP and now have cash to feed the HC side for hyper growth in selling of Adlife platform while Augme is running blocks from competitors. Now thats a thing of beauty!

      • continued. they sell hipcricket, the overhead is non existent, they become a patent licensing company like VHC. if they are really entertaining selling hipcricket, they must know that the avenue for patent licensing is there for the taking... just playing devil's advocate :)

    • Amen. Exactly what I have been thinking. I don't know why anybody here would want to see this happen.

 
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