Author Topic: AIM.TO - Aimia  (Read 79238 times)

mcliu

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Re: AIM.TO - Aimia
« Reply #340 on: August 06, 2018, 05:29:38 AM »
Are there any examples of less successful loyalty runoffs than Blue Chips as a comp for Aimia? Just in case that Blue Chip was the exception not the norm..



bathtime

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Re: AIM.TO - Aimia
« Reply #342 on: August 06, 2018, 10:07:10 AM »

wabuffo

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Re: AIM.TO - Aimia
« Reply #343 on: August 06, 2018, 12:52:35 PM »
The new CEO and Mittleman really need to get on the same page.

wabuffo

Cigarbutt

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Re: AIM.TO - Aimia
« Reply #344 on: August 06, 2018, 01:02:06 PM »
http://www.mittlemanbrothers.com/wp-content/uploads/2018/08/AIM-CN-open-letter-to-BOD-08-06-18-FINAL.pdf

I think this is such a bad-ass letter to the board whether or not you agree with his points.

I think the tone of the letter was OK.
I was wrong on the negative cashflow event with the "improved offer" but I assume the offer became barely positive and AC had targeted the reserve funds as part of the closing conditions. It just goes to show how far apart the two parties were.

In the letter, the comments about the redemption liability being part of business as usual deal (negative working capital) is interesting. When you think about it, if AC starts their own program, they would gradually build this liability and all corresponding incoming cashflows would account for most of the NPV value that they attribute to this hypothetical venture at this point. Also of note (versus the BlueChip example mentioned before whereby the program became gradually forgotten), is the fact that AC, assuming a successful "launch", would likely try to "drive" their program and encourage redemption using unfunded costs recorded in the liability section of their new competitor.

Since the issue is price discovery and given what the letter implies about the redemption liabilities, I wonder why other players (private equity) are not getting involved, especially given the present context of optimistic projections and ease with leverage. In other forums, LoyaltyOne is mentioned which is interesting but I suspect that they would also lowball an offer because the move would simply be to consolidate market share.