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13-09-2012, 10:47 PM
That sounds rather complicated. My own thinking is
1) The offerors have the intention to try and privatise the company. They started with 0.135, probably with some further reserve in their banking facilities to raise the offer if the acceptances are ok. For some (whatever( reasons, they changed their mind later on in the process.
2) There are more flexibility on the things you can do to the capital structure of the company once you take it private. Helm has almost paid down its debt by now, and they have the option to relever that to extract cash for additional investments, which would be inconvenient to do with minorities asking for distributions plus the underlying leverage might not be acceptable for a publicly listed company.
3) At their level the management of a company such as K1 would have no shortage of "visitors" showing them "deals" that they could potentially do. What they have seen may have encouraged them to make the offer.
Just my thoughts and speculations. The offer is now likely to fail. But potential investors would do well to consider that K1 has a decent (or lucky) track record and their underlying investments are not a bad bunch. Whether this is a good investment - depends on what else you have on the table, their potential and timeframe to realisation.
1) The offerors have the intention to try and privatise the company. They started with 0.135, probably with some further reserve in their banking facilities to raise the offer if the acceptances are ok. For some (whatever( reasons, they changed their mind later on in the process.
2) There are more flexibility on the things you can do to the capital structure of the company once you take it private. Helm has almost paid down its debt by now, and they have the option to relever that to extract cash for additional investments, which would be inconvenient to do with minorities asking for distributions plus the underlying leverage might not be acceptable for a publicly listed company.
3) At their level the management of a company such as K1 would have no shortage of "visitors" showing them "deals" that they could potentially do. What they have seen may have encouraged them to make the offer.
Just my thoughts and speculations. The offer is now likely to fail. But potential investors would do well to consider that K1 has a decent (or lucky) track record and their underlying investments are not a bad bunch. Whether this is a good investment - depends on what else you have on the table, their potential and timeframe to realisation.