Author Topic: Multibagger speculative ideas  (Read 90414 times)

jawn619

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Re: Multibagger speculative ideas
« Reply #20 on: June 22, 2015, 08:21:33 AM »
Crossroads. $30M market cap company with $200M of pending litigation damages coming in Jan 2016. Also has another patent portfolio that could be worth A LOT more. like near the $1B mark.


sculpin

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Re: Multibagger speculative ideas
« Reply #21 on: June 24, 2015, 05:39:19 AM »
For those of you who own MHY.UN on the TSX...

Mobilicity seeks court’s OK for $465-million takeover offer from Rogers

Mobilicity has accepted an offer from Rogers Communications Inc. and plans to seek court approval of the $465-million sale.

The small wireless carrier, which has been under creditor protection since September, 2013, will take the agreement to court Wednesday morning, according to a court filing.

The Globe and Mail reported Tuesday evening that sources familiar with the negotiations said the company had accepted the agreement after weighing competing bids from Rogers and Telus Corp.

The filing, which was posted on the website of the monitor in its restructuring process overnight, confirms that Mobilicity accepted a bid from Rogers and is asking the court to approve the deal on Wednesday.

Bill Aziz, Mobilicity’s chief restructuring officer, said in an affidavit that he understands the agreement has the support of “substantially all of [Mobilicity’s] secured debt holders.”

The filing said services for Mobilicity subscribers will continue uninterrupted. The carrier offers discount wireless services and has customers in Toronto, Ottawa, Calgary, Edmonton and Vancouver.

The company’s main asset is its spectrum – the airwaves used to build cellular networks – which it purchased for $243-million in 2008. The federal government must approve transfers of spectrum and has previously blocked Mobilicity’s attempts to sell its licences to Telus, one of Canada’s three largest wireless carriers. Telus offered $380-million in its original 2013 deal and $350-million in a deal last year.

But Ottawa’s policy on the wireless industry has been aimed at encouraging a fourth carrier in every region to give consumers an alternative to the Big Three and the government has said it would not approve deals that resulted in an undue concentration of airwaves in the hands of Canada’s dominant players.

Yet, the landscape has shifted thanks to recent policy changes allowing for more spectrum to be put to mobile use, as well as three public auctions in little more than a year plus the 2008 auction that first reserved airwaves for new entrants.

While Canada’s dominant carriers together held 98 per cent of available mobile spectrum in 2006, Industry Minister James Moore has said he expects new players to control 25 per cent by this summer. Wind Mobile Corp. has also emerged as a more viable competitor in recent months, with new ownership, a new CEO and a swath of new airwaves it purchased for a low price.

Mr. Aziz stated in the affidavit, “It is my understanding, given recent developments in the Canadian wireless industry and specifically recent auctions of spectrum, that Industry Canada no longer has the same concerns it once did about ‘undue spectrum concentration’ among certain wireless carriers in Canada.”

Sources say the deal include the transfer of some cellular spectrum to Wind, which is believed to be a factor in the federal government’s willingness to approve a transaction at this time.

Telus, which has been pursuing Mobilicity for more than two years, is said to have offered more than Rogers, according to one source, and could seek to challenge the deal in court.

However, Mobilicity’s creditors felt the Rogers deal was more likely to be approved by the federal government.

Sources familiar with the negotiations said the Rogers deal would also see the company complete an option to purchase unused spectrum licences from Shaw Communications Inc.

Rogers and Shaw struck a broader deal that included the option in 2013 but have to date been unable to win government approval for the spectrum transfer. According to one source, Rogers is under pressure to get approval for that option as it is set to expire soon.

Mr. Aziz said Mobilicity has been in continuous discussions with potential buyers, including Rogers, for the past two weeks, a process that included multiple offers and counter-offers. He said the company was aware that Rogers needed to conclude a transaction by Wednesday, June 24 due to “other related dealings it had.”

Mobilicity therefore asked its suitors to provide their last and final offers by 10:30 p.m. Monday. Stakeholders considered the options into the night, held further discussions with the bidders and finally, the company’s board approved the Rogers deal on Tuesday.

Mr. Aziz said the carrier has outstanding secured and unsecured debt totalling approximately $600-million, including accrued interest and financing costs. The company’s original equity investors also invested approximately $250-million.

Funds from the proposed sale will be used to fully repay the company’s secured debt and repay its unsecured creditors on a pro rata basis. However, a portion of Mobilicity’s first lien bonds, which are held by Catalyst Capital Group Inc., will remain outstanding, Mr. Aziz said. The motion materials include an agreement between the company and Catalyst that was struck on Tuesday and filed with the court in confidence.

Rogers will assume Mobilicity’s outstanding debts to its trade creditors — such as suppliers and landlords – as well as its obligations to employees and dealers.

Representatives for Mobilicity, Rogers and Telus all declined to comment on the developments Tuesday evening before the court filing.

Mobilicity had 157,000 subscribers as of the end of April. In addition to its spectrum licences, it is also valuable to Rogers for its tax losses, which stood at $567-million as of the end of 2013.

Mobilicity will first seek the approval of the Ontario Superior Court judge who has been presiding over its creditor protection proceedings under the Companies’ Creditors Arrangement Act. It is then expected to seek approval from Industry Canada.

bskptkl

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sculpin

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Re: Multibagger speculative ideas
« Reply #23 on: June 24, 2015, 11:19:57 AM »
I'm long this and buying more today.
See monitor report for capital structure:
http://documentcentre.eycan.com/eycm_library/Project%20mike/English/Monitor's%20Reports%20(Sixth%20and%20Eighth%20Report%20are%20located%20in%20their%20own%20sub-folders)/Thirteenth%20Report%20of%20the%20Monitor%20Dated%20June%2023%202015.pdf

I get roughly 42% recovery for the Unsecureds...
Yes that looks about right but with all of the accrued interest on those pik's and the 1st/2nd lien notes the amount accruing to the MHY.UN may be higher than the amount shown on the portfolio updates (I assume they have not included accrued interest in these filings). I contacted Marret and they will issue a press release about this either later today or tomorrow. Another great thing about this situation is the cash extracted from the Mobilicity debt should be returned to the MHY.Un shareholders as a non taxable return of capital.

tombgrt

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Re: Multibagger speculative ideas
« Reply #24 on: June 24, 2015, 11:38:29 AM »
Emeco could probably be added here. Currently at only 1/3th the price some board members bought it at. Could pay off very well but much (if not all) is dependent on commodity prices going forward.

frommi

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Re: Multibagger speculative ideas
« Reply #25 on: June 24, 2015, 12:21:11 PM »
NWH.AX and RSSS.

yadayada

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Re: Multibagger speculative ideas
« Reply #26 on: June 24, 2015, 02:33:41 PM »
I'm long this and buying more today.
See monitor report for capital structure:
http://documentcentre.eycan.com/eycm_library/Project%20mike/English/Monitor's%20Reports%20(Sixth%20and%20Eighth%20Report%20are%20located%20in%20their%20own%20sub-folders)/Thirteenth%20Report%20of%20the%20Monitor%20Dated%20June%2023%202015.pdf

I get roughly 42% recovery for the Unsecureds...
Seems likely they get much more? 440m$ available. First and second lien is 263m$. Then 155m$ for unsecured and convertible before interest. So it seems they will likely get 20m$ or so?  that would mean almost a double.

Any value for that mining company? They are held at 72c.

So First and second + interest is about 15m$. Or 40c. This is almost guaranteed. Then let's say 15m$ for unsecured, and you get 80c. So anywhere between 40c and 160c. I supose we will see.
« Last Edit: June 24, 2015, 02:36:35 PM by yadayada »

bizaro86

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Re: Multibagger speculative ideas
« Reply #27 on: June 24, 2015, 02:56:20 PM »
I'm long this and buying more today.
See monitor report for capital structure:
http://documentcentre.eycan.com/eycm_library/Project%20mike/English/Monitor's%20Reports%20(Sixth%20and%20Eighth%20Report%20are%20located%20in%20their%20own%20sub-folders)/Thirteenth%20Report%20of%20the%20Monitor%20Dated%20June%2023%202015.pdf

I get roughly 42% recovery for the Unsecureds...
Seems likely they get much more? 440m$ available. First and second lien is 263m$. Then 155m$ for unsecured and convertible before interest. So it seems they will likely get 20m$ or so?  that would mean almost a double.

Any value for that mining company? They are held at 72c.

So First and second + interest is about 15m$. Or 40c. This is almost guaranteed. Then let's say 15m$ for unsecured, and you get 80c. So anywhere between 40c and 160c. I supose we will see.

I think the 1st/2nds will get principal and accrued interest, so a total of $308MM for DIP/1st/2nd. That leaves $140MM for the senior unsecured/pari-passou unsecured, of which there is $310MM outstanding including accrued interest. 

So after they get their $15MM for the secured, their 15.5% PIK would have a maximum recovery of 45%. However, there will naturally be costs associated with the CCAA/monitor/wind-up which will come from the recovery. Best case scenario is another $20MM, but that seems generous. That gets you a best case scenario of just under $1.00, but I agree that $0.40 is the downside if Rogers is allowed to close. I do think there is still regulatory risk here, Industry Canada refused to let them sell to Telus last year, they may not let them sell to Rogers either. If they make them sell to a "4th carrier" the only option is wind (or MAYBE videotron), and they'd get less from either of them than any of the incumbents.

I went through Cline's reports, and they have a bit of cash left but it looks like they're reorganizing, so I think they intend to spend the cash trying to sell the mining assets. Not something I'm likely to stick around for.

Big thanks to Sculpin for posting this, I bought this morning and am enjoying the quickest double of my investing career.

yadayada

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Re: Multibagger speculative ideas
« Reply #28 on: June 24, 2015, 03:05:22 PM »
The last part o f 12% convertible comes after the second last and the unsecured. So you can exclude 50M$ right there.

So unsecured and pari passu notes are 265m including interest. And the first two are 215 for the first and 54 for second? So that is only 270m$ for the first two including interest?

And 265m for second two. But the unsecured weighs much heavier in that 265m$, since they are 165m$ of that 265m$. So they get about 62% of what remains.

So if you assume 40m$ in costs, 270m$ for first two, there is about 130m$ left over for the unsecured and the 12% pari passu. Which is 80m$ or 48%. So 48% of 30m$ (including interest here), is 15m$.

sculpin

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Re: Multibagger speculative ideas
« Reply #29 on: June 24, 2015, 06:40:03 PM »
It appears that the Mobilicity deal now has Competition Bureau approval as well as stated in the following Globe article tonight. So the only loser here is Telus and given all of the checkmarks (Court, Regulatory & Competition Bureau) it does not seem very likely the deal can now be rescinded. Congrats to all who bought into this. First time I think I have had a position go up by 212% in one day. Hoping to see Marret clarify the potential NAV impact in a press release tomorrow.

Rogers said Wednesday evening that it has now received all necessary approvals for the transactions, including the green light from the Competition Bureau.

June 24, 2015
Mobilicity deal positions Wind to compete with wireless Big Three
By CHRISTINE DOBBY
Small wireless player was pivotal in 'remarkable' $465-million deal for carrier that had been in creditor protection

Startup wireless carrier Wind Mobile Corp. has emerged as a key winner in a deal between Rogers Communications Inc. and Mobilicity that awards Wind the cellular airwaves it needs to expand and improve its network at no cost.

The Toronto-based carrier was pivotal in the $465-million deal no one in the Canadian wireless industry thought could get done. As part of a series of spectrum licence transfers from both fellow new entrant Mobilicity and Shaw Communications Inc., all of which Industry Canada has now approved, Wind now has more of the resources it needs to compete against the Big Three wireless players.

Wind paid a bargain-basement price for a significant chunk of licences in a spectrum auction in March, but it cannot yet deploy service with those airwaves because the necessary ecosystem of mobile devices for that frequency band does not yet exist. The airwaves it will get through the Rogers transactions – which are in the same frequency band Wind bought in 2008 and built its original network with – will allow it to start building an LTE (long-term evolution or fourth-generation) network immediately.

"This is a remarkable transaction," Orestes Pasparakis, a lawyer for Mobilicity, told the Ontario Superior Court judge who approved the deal Wednesday morning, apparently still somewhat amazed himself as he recalled the company's frustration with government policy on the path to finally getting the deal done.

Others like it had been floated before – Rogers courted Wind Mobile at one point and Telus Corp. repeatedly offered to buy Mobilicity – but as the federal government's fourth-carrier policy for the industry hardened in the summer of 2013, it became clear that Ottawa would not bless a tie-up between one of Canada's dominant three carriers and its struggling new entrant players.

The Rogers proposal allowed the government to finally approve a deal for long-floundering Mobilicity, give Wind another spectrum boost and a quick path to LTE and, at the same time, address the sticky issue of what to do with an option agreement Rogers struck in early 2013 to buy unused spectrum from Shaw. Rogers said Wednesday it will pay a further $100-million to Shaw for the licences.

The fact that the transactions cleaned up so many outstanding issues and offered more help to Wind is believed to have been central to the federal government's willingness to approve the deal over one with Telus that did not offer as much of a benefit to Wind and left the Shaw spectrum stranded.

"Wind played a key role at the table, but Rogers brought the cheque book," said a source close to the negotiations.

Talks heated up over the past two weeks, with a flurry of offers and counteroffers, and Rogers had a team of 20 people in Ottawa and Toronto working on the transaction.

Sources said Telus offered to pay more, but Mobilicity's stakeholders were more confident they could win government approval of the Rogers deal. After more than two years of attempts to win Mobilicity's spectrum, Telus executives are said to be disappointed with the outcome and weighing a legal challenge of some sort. Telus did not reply to a request for comment Wednesday.

Bill Aziz, chief restructuring officer for Mobilicity, which has been under creditor protection since September, 2013, said he would not discuss the bid process publicly, but added, "We went with the deal that was the highest price and the most executable."

"Everybody's a winner today except Telus, unfortunately," Alek Krstajic, chief executive officer of Wind, said.

"Mobilicity wins, Shaw wins and Rogers wins. But most importantly, the big win is for Canadian consumers due to the government policy."

"Our government has one goal: to take deliberate, concrete steps to create more choice, lower prices and better wireless service for Canadians and their families. Today's approval of these licence transfers delivers on this objective," Industry Minister James Moore said in a statement.

Rogers will continue to offer service for Mobilicity's 157,000 customers, transitioning them over to its network. Spokesman Aaron Lazarus said Rogers has not yet determined whether it will retain the brand as a discount wireless offering.

Mr. Krstajic said Wind also negotiated an option that allows it to opt to pay Rogers $25-million in exchange for half of Mobilicity's cell sites and equipment. Finally, it gains new licences for spectrum in Manitoba and Saskatchewan, which he said the company would consider selling to MTS Inc. or SaskTel, respectively.

Although Wind walks away happy, it ironically managed to facilitate a deal that saw its one-time rival Mobilicity sell for far more than Wind itself was able to attract last fall, when a consortium of investors bought it for $300-million. Of course, in that case, a sale to one of the Big Three was not seen as an option.

Meanwhile, Rogers gains new chunks of contiguous spectrum – which means the frequencies are right next to each other, allowing it to offer more speed and capacity – and will be able to use Mobilicity's losses to reduce its tax bill by $175-million.

Scotia Capital Inc. analyst Jeff Fan called the transactions, "Probably the best strategic move Rogers CEO [Guy Laurence] has made since joining the company."

Shaw said in a statement Wednesday it made a total of $350-million selling its spectrum licences to Rogers after originally purchasing them for $190-million in 2008. Rogers paid $50-million to Shaw for the option plus a $200-million refundable deposit, which, given the government's policy on transfers to incumbents, many had assumed Shaw would eventually have to return. The fact that the option was successfully exercised after all and Rogers paid the extra $100-million gives Shaw a nice boost to its balance sheet.

Rogers said Wednesday evening that it has now received all necessary approvals for the transactions, including the green light from the Competition Bureau.