This article is excerpted from a letter by MOI Global instructor John Lewis, chief investment officer of Osmium Partners, based in Greenbrae, California.
As we mentioned in our last newsletter we were looking to raise a fund for two ideas that we thought had 3-4x upside over the next 3-4 years.
One of the ideas is off the table, as a group consisting of the CEO, another Board Member, and Chairman bought the 10 million share block about 10 days ago, which is what we were looking to buy in the proposed side pocket.
This first idea we were seeking to raise a fund for was Glacier Media (GVC.TO).
GVC trades at CAD$0.65 and we think the business could be sold today for about 3-4x what it is trading for in the markets.
We believe just two, REW and ERIS, out of their many businesses, alone could be sold for close to the entire value of the enterprise and make up less than 10% of total revenue.
In April, Glacier sold their share of a 50% interest in Fundata for $55 million which is slightly below the current market cap.
GVC now has 70%+ of their EBITDA from growing businesses in digital and subscription services and generates over 100 million plus page views a month across their properties in Real Estate, Community Newspapers, Farm/Ag, Mining, Oil and Gas.
We think the business could generate over $30-35 million annually in EBITDA in about 2-3 years on about a $90 million EV.