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HRG Group, Inc. Message Board

  • EvanMacDonald EvanMacDonald Nov 30, 2011 12:41 PM Flag

    Absurdly low valuation

    Their stake in SPB alone is worth $770m, more than $100m more than their market cap, so you're getting that plus an insurance company, a $50m stake in NOA, and some cash for free.

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    • I agree it seems very cheap.

      Also, factor in their stake in XTXI.

      But you must then account for the significant debt position (with 10%+ coupon), dilution potential of the recently issued preferred stock, and the tax ramifications of any appreciation in their holdings relative to their cost basis upon a sale.

      Finally, I think there is an overhang/discount associated with Lightsquared. Any day you may wake up to find out that you are now the happy owner of a significant chunk of this company. I think that potential keeps many people away.

 
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14.06+0.19(+1.37%)Jul 22 4:02 PMEDT