IPO goes out around $9.00 per share and within a year, stock is selling in low $20's. FNF stock sells in the low $30 range. Just looking at what FNIS did and thinking history will repeat itself.
This is and has a respectable board just periodically it falls prey to an interesting concept.
That concept being freedom of speech on a no cost public message board.
Gotta take the good with the bad, currently no other system would work as well, IMHO.
Very little and very small is my opinion.
Taken from the 1st quarter statement dated 4/29/04. "FIS Generated $237M for the 1st Qtr" which DOES NOT include any rev for the Real Estate division. An annual est for FIS is in excess of 900M. The pretax profit margin was around 15%.
If VooDoo thinks that that business can be bought for 500M, I suggest that he sell some of his stock holdings and buy the entire IPO (as he describes it).
Sorry VooDoo but you get DooDoo for your position on this matter. Suggest you call Foley direct with your offer since he may be able to set you straight with his laughter response.
Have a good weekend
<So you have independent investors who don't own FNF but rather 20% of FIS subsidizing the debt of FNF?>
Actually, it's the other way around. If FNF owns FIS, why wouldn't they deserve all of the proceeds? If half of the sale proceeds stay with the FIS sub and half flow to parent FNF, then you could say that 10% of the sale price is effectively additional working capital for those new 20% owners. Think about it.
Maybe someone can clarify this scenario:
FNF floats 20% of FIS for $500 million. That is, the investors who paid the $500 million get 20% of a company that now has $250 million of additional capital. What happens to the other 250 million they invested?
"FIS intends to use approximately $250 million of net IPO proceeds to fund a dividend payment to FNF, which will be declared prior to the completion of the offering. FNF intends to use those dividend proceeds to pay down existing debt"
So you have independent investors who don't own FNF but rather 20% of FIS subsidizing the debt of FNF?
"Think about what you are saying buddy. It doesn't make sense, and the markets are not supporting your proposition."
Read your own words, the market isn't saying anything about the issue, because as you say you aren't getting something for nothing. The market's reaction merely says that the pricing of sum of the part is worth more than the pricing of the whole. How that value is apportioned to the different parts, and what part of it is sold for cash is not remotely relevant to the market cap. The whole market cap is post-announcement is $6.5B, so it is conceivable that the market finds one part to be worth $4B and the other to be worth $2.5B. FNF the title giant as an individual stock is likely to be worth less post-distribution than before, and that needs to be considered in all this bickering.
"IT'S WORTH $3 a share to FNF shareholders, stupid. Let me explain it to you again: If you own a share of FNF stock, the IPO will add $3 a share of value to it."
IPOs of divisions don't add a cent of value, they just make people look at the existing value differently. In fact, since they will pay millions to the banks that handle the transaction, you could argue that they destroy value. People are just paying a $2 or $3 premium now based on a change in perception, that the new company will be more glamorous. If you notice that they are using a big chunk of the money to pay off debt, you have to wonder what prospects they are really looking at for the new entity. Not sure it all makes a lot of sense, except for perception in the short term.
"The value of the IPO was stated to be $500M, and that includes all stock issued, even if it was unsold. Period."
Read the press release a little more carefully. They are talking about the amount of money they expect to receive. Spinning off shares to shareholders doesn't bring in any money, so it is fairly clear that the dollar value is only talking about the portion that will be sold. I don't know what percentage they plan to sell versus hold, but it appears pretty clear that they are only talking about the shares that will be sold.
Unfortunately he is serious. This is how he was when he first started posting here. Then, for whatever reason, he became more civilized. Maybe he hasn't been taking his medication.
The latest rants even have me concerned for his well being. Voodoo, seriously, please get some help.
Voodoo, $500 million is obviously only the expected value of the percent initially spun off, since it's far less than Fidelity paid for all the components in the first place. You know that. You're just in the mood to stir the pot this week, aren't you? Can't believe how many are taking you seriously.