Better than expected US business made up for weak business trends in the UK. This will continue during FY15 as the UK has plenty of issues e.g. the loss of a private label customer, forex headwinds and severe competition.
They have the cash on hand or will at least be able to get the money from their parent company to redeem the convert. So this is neither positive or negative at first glance. From a balance sheet perspective some cash and some debt will be erased causing the balance sheet to shrink by that amount on both sides.
The notes contain a put option which allows investors to put them back to the company in 2015 and that's why HSOL HAS to redeem them soon. This is by no means a voluntary action by the company and if anything it is rather negative as the company will suffer a material cash outflow.
none - the bond issue has been discussed on almost each conference call so far. The company is redeeming the convert from cash on hand or by borrowing from their parent. This is a well known non-issue.
it is just the enterprise value - that means current market cap plus debt load to get to the .8 bln for HSOL
not really - Q-Cells is still losing money and despite not formally merged the companies already previously worked together as they shared the same parent company.
At current share prices the enterprise value of the combined company is close to market leaders like FSLR or SPWR despite much weaker margins and ongoing losses.
This is absurd und will be corrected over time. I see HSOL shares being overvalued by at least 50% here.
they won't sell as the new shares make them control the company completely - but they ousted current HSOL shareholders through this move
Actually the shares should be down by 50% or even more as the deals' main rationale was to oust current HSOL shareholders.The two entities were owned by the same parent anyway so they were already able to manage orders and shipments with regards to tariffs.
HSOL was effectively ordered to overpay at least three times for the Q-Cells business in order to get the full control over the merged entity and leave as little on the table for current shareholders as possible.
Utter nonsense. Q-Cells announced a profit for Q1 FY14 but remained silent for Q2 and Q3 which is pretty much telling I guess. The combined entity will continue to record sizeable losses but the deal should be mildly accreditive overall which means somewhat lower losses than when acting as separate companies. Anyway the major dilution suffered by HSOL shareholders today will make the current share price unsustainable going forward.
why switching from soon to be bankrupt NADL to VERY soon bankrupt FRO ? I don't get it. They have a convert due in a few weeks.
I don't think the deal makes sense for the PE buyer without the Microsoft relationship and therefore will most likely be called off. I would strongly expect MSFT to not renew the deal given the wording of the SEC filing.
I don't think so. The Microsoft contract amounts to 1/3 of the company's revenues - a loss would make the dealer really expensive for the PE buyers and even worse wouldn't even make much sense anymore. I bought some shares at $18.50 but will take the loss if the shares make new lows
That's what I meant. A clever move bei parent Hanwha at the expense of current HSOL shareholders. You just need to read the press release again. HSOL will BUY Q-Cells from their corporate parent and issue tons of new shares to the parent. After the transaction the parent will control 94% of the new HSOL instead of 47% today.
That's just one side of the equation. Without the Microsoft deal the acquisition won't work for the acquirers. Would expect the deal to be renegotiated or to be called off completely in case that MSFT walks away.
Actually we need to know the debt load of Q-Cells to make a comparison. At the time of the acquisition out of bankruptcy Hanwha assumed roughly $300 mln in debt. But anyway we look at this from the outside - the acquisition seems heavily overpriced and done for a sole purpose - to benefit the controlling shareholder.
no - I already considered the deal as a slight positive on Friday - just like the SA does - but the shares traded like this was the mother of all deals which it certainly is not. So with the momentum traders leaving and another messy transformation year to start for ALSK I would expect the shares to move back below $1.50
The shares are under most investor's radar but clearly this is a great move bei Hanwha to merge their solar subsidiaries and gain full control over the combined company without committing any new money.
Q-Cells was bought by Hanwha out of bankruptcy in 2012 for EUR 250 mln and some two years later the company's value seems to have at least tripled by some kind of miracle. HSOL is overpaying by a large amount here to put Hanwha in full control of the combined business
And we can assume that if there were favorable numbers Hanwha wouldn't have hesitated to share them with us.