Looks like they are about to do another secondary. Only $4 million in cash left and a 50% move off the bottom. I bet announce something here real soon for a secondary at $12 a share
Read very closely about convertible debt offering! They might not issue new stock but at low interest rates they could do a convertible debt offering with a significant equity component. This would also drive down the stock price. The only fact we all know is that they need cash. How will they raise it? I bet a convertible debt offering will be announced
spot on Hammer, nice job. Nobody likes stock delusion , but this is way over sold. Sure they will use money to load up more shares of Twitter, knowing it's just around the corner of it's IPO. I'm adding at this beat down share price...
The company, as they stated, is only interested in accretive deals. Why then would they consider a convertible deal with "a significant equity component"? That would entirely defeat the purpose of doing a convertible debt offering. Nothing wrong with a convert as long as isn't too onerous to the shareholders.
This is from their 10Q
We seek to deploy capital primarily in the form of non-controlling equity and equity-related investments, including common stock, warrants, preferred stock and similar forms of senior equity, which may or may not be convertible into a portfolio company's common equity, and convertible debt securities with a significant equity component. We used substantially all of the net proceeds of our initial public offering and follow-on offerings for the above purposes.
These guys very clearly stated that they would not be offering additional equity at the current price during their conference call. However, they certainly have that ability if the share price goes above NAV.
I can't remember the exact numbers, but their last secondary hit existing shareholders like a ton of bricks when they sold additional shares at $16 when it had been trading at $20. In retrospect, it was perfect timing as they brought in a ton of additional cash right before the share price fell with the facebook IPO.
This should serve as a cautionary tale to all. If GSVC's price continues to rise (and I think it will) to where it is substantially above NAV, hold at your own risk because you could get smacked by another secondary at any time.
The one thing that people should have an appreciation for, just because it’s important, is as we look at sources of capital for us, cash for us – we will not be issuing equity. We will not be doing an equity offering even at current share prices. The stock has had a nice move recently but it’s still at in our view a pretty significant discount both NAV and then you add some other things that we discussed on this call. We’re not interested in that at all. We’re looking to do smart things that are accretive for our shareholders, and just to be very clear that’s not something that we would do now at this price.