CANEXUS CORP 6.5 PCT DEBS T.CUS.DB.D

Shareholder Approval of Deal

[DerbyDog]

I am a shareholder and excited about the prospects of this deal going ahead.

I seem to be reading commentary to the contrary and am puzzled by the narrative.

My small cap company is acquired at a premium and my new investment has a 5% yield and plenty of room for long term capital gain? I have climbed the ladder with regards to quality and I own a buy and hold forever income machine/security. I love it.

I am surprised to see that the SP has not climbed to the 1.70ish offer price and assume this is due to a % chance of a "no" vote from shareholders of CUS. I am not a day trader so have no aspirations to play the arbitrage game here, just curious to hear from some of the veterans on the board as to when we can expect better clarity.

Good hunting to you all!

[ronstren]

All good points derby dog !!

[phoenix_trader]

Given the current trading range of low $1.40's the market is saying the deal is maybe dead. All boils down to whether the COP of $27.4 mill for Q2 is about what we can expect for the next few years. If it is then the bank debt can be paid off in 3-4 years as capex can be scaled back and debt retirement prioritized. Obviously your cost is a lot lower than the majority who may decide the present

[pierrelebel]

"the market is saying the deal is maybe dead."  I agree with you.  The discount has expanded from 10% a week ago to 19% a few minutes ago.  Does not look good for CUS shareholders.

[Roxy27]

phoenix_trader, One comment and a couple of material items to point out; Dividend is very safe, which is why analysts were asking when their next increase review was expected on the conference call. 1) SPB has seasonality in that they are an energy distributer with peak volumes occuring in the winter. The good news is, winter is re-occuring, annually. Expect tougher YoY comps as we've had

[phoenix_trader]

SPB's divy payout is 40-54% of Cash flow and is taking on new debt to buy CUS. Sounds to me CUS shareholders are jumping back into the fire. The only folks who win here are recent buyers of the CUS conv debs cause they get paid out. Those same conv debs are included in your 5.3 ratio. Guess what, CUS has the cash now to payoff the $60 million maturing in Dec, the rest ($230 million) well they

[DerbyDog]

Thanks to all for weighing in. Seems to me (setting aside the short term volatility of a no vote), I win by staying long the stock either way. With respect to phoenix, I think I will likely abstain from voting, but very much appreciate the feedback.

[Calgaryrider]

Let's be clear, the deal that Doug and management got is a terrible deal for shareholders, the majority of which surely have a very high average cost basis - many of them institutions. I believe the institutions will vote yes and just simply write-off their losses with this pig, and retail investors will be meaningless in the overall scheme of things....they always are. With that said, as

[phoenix_trader]

Wrong, FCU's shareholders voted no and the price increased. This is all about Cash flow and paying off secured debt. The Chemical assets spun cash to the tune of $57 million in the past six months. Not bad given all the other headwinds buffeting management. Lots of folk here with vested interests, I say the SPB deal benefits SPB more than CUS. We are rid of NATO, have huge cash from Chemical

[Roxy27]

phoenix_trader, you are confusing operating profits with cashflow. CUS had distributable cash of minus $2.7 million in the past 6 months. Positive $6.5 million when adjusting for 1 time costs, not $57 million cash as you've stated. 

[labour220]

This post has been removed in accordance with Community Policy

[BlueCollar51]

phoenix; If I still had my CUS shares this is how I would assess the offer from Superior Plus.   First it’s the Chemical Industry. It’s not the best of times for the Industry. There has been some price weakness and the near/mid-term outlook for the industry is not robust.   In the current environment Chemical Production facilities do not sell for “premium” multiples.   Superior is