any thoughts on the radiant acquisition of wheels? looks like wheels runs a decent business in canada (14% margins) but a lousy business in US (sub 10%). so the idea is to merge Radiants US forwarding/ltl business with wheels in US and boost margins.
crain doesn't like to be levered more than 2.5x ebitda. according to the initial figures on this deal of $30M ebitda, that would put max debt at $75m. But . . . there's now about $90m of debt. at 2.5 that is 36M ebitda. how to get to 36? figure 18m of legacy radiant ebitda (prob higher) take 300 of wheels revenue figure 12% blended gross margin at 50% ebitda margin gets you to $18M wheels ebitda.
great gross margins in canada. 14.5%, which is huge for truck broker. huge executive bloat. management has been paying themselves well and diluting the other shareholders. lousy gross margins in US but should rise once traffic flows through us line haul network. overall 5% margin is very doable, that's $15M. more is possible.
I don't know. TGA has lots of cash, which is more than 95% of the other oil companies. I could see a fast rebound too. coin flip at this point. oil could bounce big at these levels.
many things for tga to do: buy back convertible stock (17% return), buy back shares (ridiculous per boe), buy from cash poor competitors, etc. And pay attention to the line in the latest release that TGA will not be dealing with Egypt gov't any longer, will contract directly with foreign buyers. that frees up $100M of working capital to do lots of stuff with, including buying shares. I;m in at $2.95.
can they even nationalize it? They don't have the expertize.
Well they went into October with $889M of debt and took the rouglhy $160M from the offering to reduce debt. So that leaves around $700M.
generous assumption get this to $2.10 at the top end. $1.60 at the bottom end. Wide variety. I would say that the numbers were a disappointment. 2800 is far off the estimates.
here's how I bet this was sold to the buyers. buy shares now at this inflated price and we'll sell you more shares later at a lower, better price. there is simply absolutely no way this is worth $15.
If LGIH had trouble selling shares on IPO, then biggest buyers bought more than they wanted to. That explains gradual dribbling out of shares. Paring down stake to more manageable level.
way ahead of itself. FBRC is ten times better firm and trades at lower valuation. I don't know who's pumping this up or why but it has something to do with the convertible.