Author Topic: LILA - Liberty Global Latin America tracker  (Read 112844 times)

afm408

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Re: LILA - Liberty Global Latin America tracker
« Reply #330 on: January 15, 2019, 02:56:28 PM »
Hopefully, shareholders won’t get screwed over like with the C&W merger. Millicom appears to be far larger than LILA, so shsreholders will hold only a minority share of the combined company.

Good news is LILAK shareholders are on the same side as malone, vs. with C&W they were on the opposite side of him (he owned much more C&W via Columbus merger than he did LILAK).  Also, Millicom is much bigger, but given the large cash component that can come from leverage (especially post synergy EBITDA), LILAK will end up owning a significant majority of the combined co.  Plus, they can sell the African assets of Millicom, which would probably generate $1b.


meiroy

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Re: LILA - Liberty Global Latin America tracker
« Reply #331 on: January 16, 2019, 04:16:44 AM »
Hopefully, shareholders won’t get screwed over like with the C&W merger. Millicom appears to be far larger than LILA, so shsreholders will hold only a minority share of the combined company.

Good news is LILAK shareholders are on the same side as malone, vs. with C&W they were on the opposite side of him (he owned much more C&W via Columbus merger than he did LILAK).  Also, Millicom is much bigger, but given the large cash component that can come from leverage (especially post synergy EBITDA), LILAK will end up owning a significant majority of the combined co.  Plus, they can sell the African assets of Millicom, which would probably generate $1b.

So he intentionally fucked the shareholders for his own benefit?  Qualitatively, this is reason enough not to own this. It's so much cheaper now, though...


NewbieD

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Re: LILA - Liberty Global Latin America tracker
« Reply #332 on: January 16, 2019, 04:24:27 AM »
What about buying Millicom here? Seems like the markets estimation of price level and/or probability of closing is not that high. I would think any offer would need to be at least $80 to be accepted. What is the base rate probability of Malone following through on a company he has expressed this level of interest in?

afm408

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Re: LILA - Liberty Global Latin America tracker
« Reply #333 on: January 16, 2019, 05:26:30 AM »
Hopefully, shareholders won’t get screwed over like with the C&W merger. Millicom appears to be far larger than LILA, so shsreholders will hold only a minority share of the combined company.

Good news is LILAK shareholders are on the same side as malone, vs. with C&W they were on the opposite side of him (he owned much more C&W via Columbus merger than he did LILAK).  Also, Millicom is much bigger, but given the large cash component that can come from leverage (especially post synergy EBITDA), LILAK will end up owning a significant majority of the combined co.  Plus, they can sell the African assets of Millicom, which would probably generate $1b.

So he intentionally fucked the shareholders for his own benefit?  Qualitatively, this is reason enough not to own this. It's so much cheaper now, though...

Yes, although I think he would probably say that he was maximizing the value for CWC shareholders, the side that he was on, which I think is normal in any M&A transaction.  Regardless, it has long been John Malone's MO to try screw the other side of the table for his own benefit.  Every deal is fraught with complexity, which is meant to stack the odds in his favor (e.g. look at a case study of the original Liberty spin).   If you have issues with this you should not own any liberty entities.  However, history has shown that if you are on HIS side of the table, you benefit enormously and compound at very high rates.  So I think following the  money, often through complexity, is very important.  And, in this situation (as opposed to CWC, but similar to many other Liberty home runs), you are on his side of the table. 

afm408

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Re: LILA - Liberty Global Latin America tracker
« Reply #334 on: January 16, 2019, 05:32:55 AM »
Hopefully, shareholders won’t get screwed over like with the C&W merger. Millicom appears to be far larger than LILA, so shsreholders will hold only a minority share of the combined company.

Good news is LILAK shareholders are on the same side as malone, vs. with C&W they were on the opposite side of him (he owned much more C&W via Columbus merger than he did LILAK).  Also, Millicom is much bigger, but given the large cash component that can come from leverage (especially post synergy EBITDA), LILAK will end up owning a significant majority of the combined co.  Plus, they can sell the African assets of Millicom, which would probably generate $1b.

So he intentionally fucked the shareholders for his own benefit?  Qualitatively, this is reason enough not to own this. It's so much cheaper now, though...

Yes, although I think he would probably say that he was maximizing the value for CWC shareholders, the side that he was on, which I think is normal in any M&A transaction.  Regardless, it has long been John Malone's MO to try screw the other side of the table for his own benefit.  Every deal is fraught with complexity, which is meant to stack the odds in his favor (e.g. look at a case study of the original Liberty spin).   If you have issues with this you should not own any liberty entities.  However, history has shown that if you are on HIS side of the table, you benefit enormously and compound at very high rates.  So I think following the  money, often through complexity, is very important.  And, in this situation (as opposed to CWC, but similar to many other Liberty home runs), you are on his side of the table.

And just to clarify, he screwed LILAK shareholders, of which he owned 2%, for the benefit of CWC shareholders, of which he owned 25%.  This was all disclosed in filings and it was clear where his interests lay.  That being said, he did it for all equity because he believed in the LILAK equity.  And, he has since bought more on the open market, at prices meaningfully higher than today's.

Jurgis

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Re: LILA - Liberty Global Latin America tracker
« Reply #335 on: January 16, 2019, 07:12:47 AM »
Hopefully, shareholders won’t get screwed over like with the C&W merger. Millicom appears to be far larger than LILA, so shsreholders will hold only a minority share of the combined company.

Good news is LILAK shareholders are on the same side as malone, vs. with C&W they were on the opposite side of him (he owned much more C&W via Columbus merger than he did LILAK).  Also, Millicom is much bigger, but given the large cash component that can come from leverage (especially post synergy EBITDA), LILAK will end up owning a significant majority of the combined co.  Plus, they can sell the African assets of Millicom, which would probably generate $1b.

So he intentionally fucked the shareholders for his own benefit?  Qualitatively, this is reason enough not to own this. It's so much cheaper now, though...

Yes, although I think he would probably say that he was maximizing the value for CWC shareholders, the side that he was on, which I think is normal in any M&A transaction.  Regardless, it has long been John Malone's MO to try screw the other side of the table for his own benefit.  Every deal is fraught with complexity, which is meant to stack the odds in his favor (e.g. look at a case study of the original Liberty spin).   If you have issues with this you should not own any liberty entities.  However, history has shown that if you are on HIS side of the table, you benefit enormously and compound at very high rates.  So I think following the  money, often through complexity, is very important.  And, in this situation (as opposed to CWC, but similar to many other Liberty home runs), you are on his side of the table.

And just to clarify, he screwed LILAK shareholders, of which he owned 2%, for the benefit of CWC shareholders, of which he owned 25%.  This was all disclosed in filings and it was clear where his interests lay.  That being said, he did it for all equity because he believed in the LILAK equity.  And, he has since bought more on the open market, at prices meaningfully higher than today's.

Malone took LILA shares for his CWC holdings during the merger. And then LILA dropped a lot after the merger. So you could say that he screwed himself...  ::)
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Liberty

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Re: LILA - Liberty Global Latin America tracker
« Reply #336 on: January 16, 2019, 07:14:22 AM »
People seem to assume that Malone is omniscient. He's very good, but he makes mistakes too. Same with LBTYA, which I'm pretty sure didn't turn out how he wanted to.
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afm408

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Re: LILA - Liberty Global Latin America tracker
« Reply #337 on: January 16, 2019, 10:26:26 AM »
People seem to assume that Malone is omniscient. He's very good, but he makes mistakes too. Same with LBTYA, which I'm pretty sure didn't turn out how he wanted to.

Omniscient, definitely not.  Nobody is, including Buffett (Dexter Shoe, Gen Re, etc).  But, I'd generally consider the odds of making money being aligned with him much higher than most other people out there. 

EricSchleien

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Re: LILA - Liberty Global Latin America tracker
« Reply #338 on: January 16, 2019, 10:38:23 AM »
For those interested in learning more about John Malone, there's a chapter devoted to him in the book "The Outsiders". There's also a book about him which was great called "Cable Cowboy". He's the real deal.

Last year I had the pleasure of attending a Major League Baseball game with one of the owners of the team. I was a Braves shareholder so I started asking him about the business of baseball, tax implications, the Forbes valuations, etc. When I asked him about John Malone, he told me he was actually friends with him and that they own houses near each other. He said he could personally attest to the fact that he's a genius and that the Braves, in particular, were an incredibly run organization. You can that for what it is. Those books, however, are a truly fantastic look into Malone who does things very differently than say your typical value investor like Buffett.

SHDL

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Re: LILA - Liberty Global Latin America tracker
« Reply #339 on: January 16, 2019, 10:56:56 AM »
Regardless, it has long been John Malone's MO to try screw the other side of the table for his own benefit.  Every deal is fraught with complexity, which is meant to stack the odds in his favor (e.g. look at a case study of the original Liberty spin).   If you have issues with this you should not own any liberty entities.  However, history has shown that if you are on HIS side of the table, you benefit enormously and compound at very high rates.  So I think following the  money, often through complexity, is very important.  And, in this situation (as opposed to CWC, but similar to many other Liberty home runs), you are on his side of the table.

This is really fundamental when it comes to investing in anything Liberty/Malone related.  I love watching/listening to what they do/say, and I greatly admire their skills, but I've never felt comfortable really trusting them with my money. 
« Last Edit: January 16, 2019, 11:04:53 AM by SHDL »