I am wondering how corporate minority shareholders will nowon cope with their investments?
They have 2 options:
- To undertake joint lock-up agreements with Quebecor and tender their shares at a given price.
However, i dont believe that Quebecor would currently agree to pay above $3/share.
If such lock-up agreements were to occur, it would also trigger an offering for class-B shares held by retail shareholders.
- If such lock-up agreements do not occur, minority shareholders at large will be bought at some point in time, perhaps at a price lower than $3/share if trading value falls for example at a penny stock level.
The contingency risk of having TVA.B shares trading below $1 appears to be the outlook of National Bank Financial analyst Adam Shine, as a previous posting of mine.
Considering that there will be further cutbacks/restructuring charges and so on at TVA, shareholders' equity will also decrease.
I am providing you with PKP's Radio-Canada May 11, 2023 interview, regrettably not available in English.
| | Voyez cet extrait de Zone conomie ici.radio-canada.ca |
He has no immediate plan of folding TVA Sports, although he says that the awaiting CRTC decision involving Bell Media-TVA Sports will be determinant as to the future of TVA Sports. PKP is taking a wait-and-see approach with this matter, as he knows that should the CRTC upcoming decision be unfavourable to TVA Sports, how the hell could he let this unprofitable asset (having burnt over $200M to date), still running?
Minority shareholders have no control to agree or disagree about cutbacks, selling of assets, restructuring charges and so on, which are issues at management's discretion.
PKP could not ethically/humanely bring TVA under bankruptcy, but no doubt privatize it at a dirt-cheap price, which will definitely be the case.
With Q1 (2023) dismal results, the time has come to move in life and exit this company. Minority shareholders have clearly lost any attempt to see TVA.B share price reaching someday a premium price.
At a 52-weeks "low" of $1.50, it will be a long way home before the stock recovers to even a modest $3 (unless the happening of a buyout transaction), which amount is still below the company's class-B shares $5 range book-value.
Quebecor could hardly refuse a go-private of TVA at $3/share.
Minority shareholders should require Quebecor to proceed to an independent audit carried out for example by a chartered accounting firm (preferably outside of the province of Quebec) to determine the accurate price payable to minority shareholders in the event of TVA's privatization, with professional fees being funded by minority shareholders. This idea, aimed at preventing an unfair offer from Quebecor, is worthwhile of consideration.
TVA Group corporate minority shareholders must by all means schedule a meeting with Quebecor urging it to proceed to TVA's privatization, otherwise they will never be able to unload their stack of shares.
I anticipate that the forthcoming CRTC decision will pave the way to an announcement about the said privatization. It will surely be an appropriate opportunity.