Only way they'll get a decent bid is to get two competing buyers. Any potential acquirer can see they have their backs against the wall. So if they just wait long enough, they can pick up the scraps if nobody else gives them money.
Did you miss the accidental press release from last night for Q2? I believe DOM said it's still up on Nasdaq. Go take a look. I think the number was $32M in revenue w/ $1M of that profit. So that's a nice 3% GM & I believe they lost $19M for the quarter.
You're reaching Dom! Who wants to acquirer a company because they have the potential of not paying any taxes on future profits?
I would think that OCZ would have to stay as it's own independent company under the acquirers corporate umbrella for that too happen (I.E OCZ/Indilinx). Then they likely could only use those taxable pools on OCZ products, not any of the acquirers product sales.....Then OCZ would still have to find a way to make $80M (opex expenses) on their existing products during the year to take advantage of tax savings on any additional profits. Even w/ help from the acquirer in getting the products adopted & supplying NAND, they still need to grow back to $320M in yearly revenue (w/ 25% GM's) to start reaping the benefits.
Can you name a non-public company that would be interested in OCZ? Then name one that has $300M-400M in cash or can acquire debt of $300M-400M?
Kingston is about the only company I can think of & that kind of cash seems out of their reach. Everyone pretty much took market share from them in the last few years, so reserves are likely low.
MU, STX, WDC, SNDK, LSI, EMC, MRVL, all potential acquirers w/ that kind of money.
300M - 400M is not even in the ball park of what kind of offers they'd get. Any public company that offers a 300X premium to a stocks current price would get hell from their shareholders....Pharma stocks can't even get that kind of premium.
A realistic offer that they'd likely have to accept would be $150M ($2.25/share). You have to realize that by the time they are sold, they'll likely have to raise additional cash by diluting the shareholders or finding another credit facility. Add that on top of the $16M in debt they owe Hercules, the acquirer would be paying closer to $200M, but shareholders would only see $150M of that.
SEC is still around. Hopefully he'll be a jail bird by this time next year. Guess he should have run away to Panama like RP.
Adding additional expenses would just make it harder to take advantage of the tax pools by becoming profitable.
Wouldn't there be some kind of time limit on how long the tax pools would be available? Can't imagine the gov would let you take advantage of decade old losses.
I'm sure some exist, but I just don't think the odds are good. Not trying to shoot down your hopes for a big paycheck, just trying to be realistic.
Heck, if I won the lottery tomorrow, I'd buy the company. I agree that it's undervalued & $300M-400M is potential what it's worth, but that's if the company had breakeven in sight w/ a few small profits after that. But companies rarely get their actual value when they are performing poorly.