RE:RE:RE:RE:RE:RE:RE:RE:RE:Enjoy the trip SouthOh you spoke to Carl a year ago before his CEO's old direct report and friend became CEO of FIRE.
Oh you spoke to Carl and expected him to tell you which companies APHA plans to buy.
Oh you spoke to Carl a year ago, when the market cap was over $500m. So the Ev was north of $600m.
The current hurdle rate for the bonds to make money is an EV of ~$85m and there is a lot of room between $85m and $600m. Plus they have already spent a lot of money restructuring the business (we'll see if performance improves).
I have no problem conceding the bonds could be a zero but I think that is not the most likely outcome which makes my expected value signifciantly higher than 27.
I don't understand why you don't want to hedge your common short position against the bonds to hedge against some of these outcomes which you assign a very low probablity to because you spoke to Carl a year ago.
brentkosta wrote: About a year ago I spoke to Carl Merton of APHA specifically about Supreme and if this might be a quality aquisition for them seeing as how they spent $350 mil for Broken Coast and its 5,000 square feet, why not pay generally the same amount for a ton more capacity and nearly as strong of a brand.
I was told from his simply that Supreme has a mess of balance sheet and APHA will not bail out a company whom will most likely fail. It seems the smart move will buy these LPs for pennies on the dollar. Anyone who believes Suprmeme has value is a fool. Look the most basic metrics. The company has failed miserably. The sales are anemic. The epenses are sky high. Insiders used it for self enrichment. There is a TON of hair on this tiker.
They are not well recieved by the general public as proof of their 30% drop on prices. As proven by their pathetic sales.
You may hang on to things like "brand of the year" but its all smoke and mirrors. Nobody gives a shyt about those awards. Its an LP hand job system,
If Supreme can get to break even they may be worthy of a buyout. But it'll be based on the fact that they are not and most likely can not be profitable. APHA whom is (typcially) extremely fiscally responsible, will not take on a losing proposition like Supreme at this time.
I'd venture to guess that due to past financing mistakes by the morons who ran this, the company will show insolvency in due course. The debt will simply be too much for this company to handle. The share structure will only get worse and the sales are stagnant.
My guess is 7acres will grow vegetables before it ever hangs an APHA banner.