GREY:STPJF - Post by User
Comment by
Eyeinvestoron Jul 17, 2014 11:13am
449 Views
Post# 22755323
RE:The Sale of Senlac - then what?
RE:The Sale of Senlac - then what?
Eye don't think that the sale of Senlac is an option for the company except in the context of a major deal where someone made a major investment into STP that prompted the debt holders to agree to allow STP to sell Senlac. Credit Suisse lent STP on a relatively low interest rate because that debt is secured on STP's assets. There are bound to be terms on that debt that prevent the sale of assets without debt holders permission.
If you have a car loan, even without looking at the loan docs, I can be pretty sure you can't sell the car without paying off the loan.
However it remains fascinating that STP is not doing pad L on Senlac. STP has the money....lots and lots of it. The only reason eye can contemplate is that there is some kind of deal and Senlac is part of it. The nature of acquisitions and deals is that they are priced on metrics that don't change much if you inject cash. If Senlac is worth around $150 million...and STP puts another $20m into pad L, Senlac will not then be worth $170 million....maybe you get some credit for recent investment and it is worth $160 million ...but dollar for dollar you hold off capex when you are in the midst of deal making.
As someone else pointed out.....STP just paid the coupon on the debs a week or so ago. They don't seem to be battened down for the long haul.
There are still too many signs out there that STP is not going down the road of the long slog of doing this on their own. I agree with Shat, that this would create max value.....but the clues do not point this way.
Of course if someone buys all or a major part of STP including Senlac than deb holders will be very happy and hopefully stock holders will be happy from this level (but not those who got in at $1.) The long slog might make more money in the long run....but....do we really have the patience?