Comments on: Why The Street (NASDAQ:TST) May be taken out soon?

By: 4 Things Elisabeth DeMarse needs to do to turnaround The Street | Wall Street Dispatch

Thu, 08 Mar 2012 19:33:15 +0000

[...] I had speculated that more drastic action was in the cards for The Street when it announces its 2011 earnings, I am [...]

By: Armani

Armani — Sun, 04 Mar 2012 20:31:16 +0000

If there is a takeout it will be for at least $4 per share. 1.5x revenues= $90m plus cash of $80m less $55m for preferred equals $115m enterprise value. With roughly 30 million shares it equals approximately $4 per share and that does not include the tax loss carry forwards so could be higher.

By: clinicalresearch

clinicalresearch — Thu, 16 Feb 2012 02:57:07 +0000

Good point. Perhaps TCV wants the stock price to go as low as possible so they can buy the company for a cheaply as possible. But if they were to buy out a company that's (marginally) profitable and has no debt for less than the value of cash on its balance sheet this seems like the kind of thing existing shareholders might try to sue over.

By: @mohannadaama

@mohannadaama — Wed, 15 Feb 2012 14:36:55 +0000

Look at it this way: Preferred shares either convert to common or have to be redeemed for $55 million in case of a takeout. Whoever buys the company will get the company's cash on the books ($75 million) but have to pay $55 to redeem Preferreds.

By: Ben

Ben — Wed, 15 Feb 2012 04:44:55 +0000

Is is realistic to think of the preferred as really a liability? I'm not familiar with the specific terms of TCV's preferred shares, but if the stock never hits $14 then then the preferred doesn't convert and the warrants don't get exercised and there's no dilution.

I don't believe the stock can ever get to $14/share. I do agree, however, with your take-out thesis: it's seems like the most TCV can do is try to take the company private, then redraw the terms of its preferred or something along those lines. Then again, this probably wouldn't be possible as long as there other shareholders in the company. Perhaps their only option is an outright purchase of 100% of the common. They could then fix the expense situation, lever the company up and take a big fat dividend.

By: Tony

Tony — Tue, 14 Feb 2012 01:10:25 +0000

Forbes had a nice article on Dec 21 2011

Furthermore, looking at specific assets such as the significant tax loss carry forward of $136m and the cash position of approx. $77m compared to the market cap of approx. $57m, we think that a concrete plan is required to ascertain whether there is still support to continuing the current course as a stand-alone enterprise.

By: Josh

Josh — Sat, 11 Feb 2012 22:01:14 +0000

Nice article – and I think the drop Friday helps with the attractiveness – a takeout at the low $2's would be tough to argue against at this point.

By: Mr. Anon

Mr. Anon — Fri, 10 Feb 2012 03:51:53 +0000

Unlikely