Imagine that any buyer would have to pay the management team off in a big way. That is too bad but it seems to be the way that small Canadian firms I have followed over the years work. What really baffles me is why people are always so willing to pay a premium to get taken advantage of. It is like they set out to lose money.
Who knows, maybe every so often one succeeds enough to justify the risk.
about the decline in price is that if it continues and the price gets below $1 it becomes conceivable that someone might agree to buy them. Not sure what that price would be. I've always said around 60 cents would be good which is still quite a ways from here. Greedy I think is around 80 cents which is probably more realistic.
Only thing the buyer would be purchasing are the distribution channels and those aren't particularly valuable.
Imagine it is obvious, but zero is possible (maybe even probable) because they took on so much debt to do the ICG acquisition at the peak. Even if they shut down everything that isn't profitable and are low-cost producer that wouldn't be enough unless they earn enough to pay back the debt.
This isn't a company that is sitting on assets with management siphoning off value. It is a company that likely has no no significant value where management has indicated that they are willing to sell.
Unfortunately, there has not been a single acquisition in the industries history that hasn't been a financial failure although they certainly have ranged from disastrous to merely not very good. If they are to be bought it will have to be cheap and Steel Partner's brings nothing to the table.
I don't know the answer to your questions but I'm confident that it isn't like this is a game changing deal. They have to do this sort of thing regularly in order to drive profitability. Besides, when people say a deal is a "game-changer" they want to sell you some stock.
Have not given it much thought but CRNT will have a mild breeze at their back on an operating basis as the Shekel as weakened against the dollar recently. Don't know what percentage of their costs are Shekel derived but know it isn't an immaterial amount.
Might add a million dollars to September quarter.
When there is no news, you gotta write about what you know about.
Should add that I would be fine with a rate reduction provided the price is tied to aluminum pricing. If ratepayers subsidize them they oughta get some upside.
I think it was a combination of things. There is the article on the layoffs, the plan to re-file the rate decrease request and Century Aluminum has been skyrocketing.
It is tough to lose a job but I don't for a minute believe it was because of the rate decision. The company might say it is and they might have even agreed to keep the jobs if the subsidized rate had been provided but Apollo is out for Apollo and no one else. If they can do the job without someone they will do so and they will make those investments in the bootheel once clarity on the rate is provided. I hope the clarity is denial of any further rate reductions but we will see.
I just don't get Needham's upgrade. The only scenario I can see $2 is a bubble CRNT can't pay that much unless their share price went to $4 or $5 a share.
Who knows, maybe they think the cycle is going to be so strong they wind up being profitable. Hard to see that happening.
Didn't sound super bullish to me. They clearly fudged on the cash generation for the quarter, they burned cash as ramping down receivables as a result of decreased sales (not DSO) is hardly generating cash. They also fudged on being cash flow break even for the first half of year. No one actually believes that do they???
I expect executives to fudge all over the place in calls so I kind of let it pass but I don't disengage my brain either.
The sale is interesting but it is pretty tough to do.
You forgot to mention that the ERP implementation is in trouble. Didn't really provide any feedback on how bad it is but it obviously isn't going swimmingly. Not many do but when you are doing it in the middle of staffing and budget cuts things can absolutely fall apart sometimes.
Yea they pumped a little but one should expect that to an extent. Didn't seem totally out of control to me.
He isn't a liar or an idiot so I tend to like him but there is no denying the poor performance. Not that anyone has done well.
Would CRNT buy them? I don't think anyone has ever done an acquisition in this sector that was actually successful so I tend to think not but I certainly don't understand the difficulties of integrating the two companies product lines.
He is fudging a bit more than usual but overall much better than most CEOs who are all too comfortable lying to investors. They more or less said that they want consolidation so I think that means they are for sale or who knows, maybe they buy someone.
10-K is going to be late. Not the end of the world.