Concordia Healthcare Corp. T.CXR.R

People, understand one thing ...

[meetoo1600]

The deal is already done.  They would not be using the CBCA if it wasn’t.  They already have the necessary votes.  They secured them by agreement before the filing.  That is how it is done.

The only question is at what valuation have they agreed to compensate the unsecured debt with equity.  It has to be fair and reasonable. Keep in mind that the valuation is of the Company WITHOUT the $2B of unsecured debt, not with it, so it gets very interesting, especially because the $2B of unsecured debt will not be valued dollar-for-dollar.  It will be valued just slightly above the common equity, because, like the common equity, it would be worth zero if the Company ultimately fell to the secured debt.  The unsecured debt needs to co-operate to ensure that that does not happen in the long run.

By the way, companies with a current ratio of 2:1 do not go bankrupt, at least not in the short-term, and that’s what the Company’s was at the end of June.  It is even better now.  Book value of the Company after the deal is done will be about $600MM.  Enterprise values will be a multiple of that.  In theory, the share value should pop, so, even with substantial dilution, anyone who bought in at anything close to current lows, say, in the last few months, should win big.

This will be interesting...

[wheelingit]

Book value of 600M, I'd like to know how you came up with this magnificent number Get the Goodwill out of your calculation and if you actually do NOT expect further write downs of their Intangibles you are a fool.. with those factored in, BV comes to a pretty interesting number. HMM Make sure to do your own due diligence everyone Wheels  

[meetoo1600]

Yes, I may be a fool, but Oberman would be a much greater one if he has not already recorded the maximum in goodwill/asset value write-downs possible.  Perhaps he has even over-stated them in order to be as conservative as possible, and to ensure that things can only get better from here. He, and his professional advisors, know that this is essential to re-establishing credibility for the

[rad10]

perhaps they got some sort of assurance of cooperation out of a majority of the unsecured debtholders - but the deal is NOT done.  There will be a lot more armwrestling. Why on earth would secured debtholders be prepared to take a haircut?

[meetoo1600]

They are not trying to get the secured debtholders to take a haircut.  They are trying to turn the unsecured into equity.  That will get rid of at least $1.8B of debt, and possibly more.  The unsecureds have every reason to co-operate, and, I am quite certain, already have. The first thing counsel advise a company considering a plan of arrangement under the CBCA is to make sure

[rad10]

Meetoo - this was your position on October the 21st.  Believe me - if a deal was done it would have been announced by now.  Spyglass merger, North American Palladium, Yellow media, the Armtec takedown by Brookfield etc etc etc  - the news comes out immediately a restructuring deal is brokered......................  Could unsecured be unwilling to go the CCAA route because

[meetoo1600]

Rad10, you wrote:  Could unsecured be unwilling to go the CCAA route because Goldman hold the bulk of the secured notes and may decide to play winner takes all?    Think about it - better to play nice and get a little of something than a little more than nothing in CCAA................ Yes, yes, yes!  Finally you understand.  This is why there will be a deal, because the

[rad10]

LOL - I have always understood - hence my positioning in this debacle. "Unwilling to take the CCAA route" is a long stretch from "already a done deal..".......... Compound interest was once described by someone a lot smarter than me as the 8th wonder of the world - tick tock....................... The beauty of the secured notes is summed up by John Goodman in the movie the

[rad10]

Often wrong - and never in doubt!  This quote was from October last year........................... No agreement was secured then, no agreement has been secured 4 months later and negotiations are ongoing in camera - hence the deafening silence.