RE: RE: RE: RE: Bankers in controlWhile that's a fair point, I'm only going to partially agree with you.
The credit facility was increased, I believe, withing the last two yearsand was extended to 2013 just last year. At that time, I am going tocontend, YLO's fundamentals were not a whole lot different than they aretoday. If anything, the risks were higher because the online revenueswere much lower than they are today, they were carrying an expensive,under-performing division in the form of Auto Trader, and the overalldebt load was just as high. Interestingly, at those times, the bankerswere just fine with the situation (or they would not have extended).They are also just fine with very similar situations in a slew of othercompanies that have weaker earnings and a less established business.
I find the timing on several events -- such as the onslaught of negativeanalyst reports, the formation of a massive short position, and thesudden pressure by the banks to protect their loans to be suspect atbest. Don't get me wrong, I think a good chunk of the bank debt neededto be included in the debt reduction plans. I think forcing thecompany's hand on the dividend issue will prove beneficial. It's the500 million lump sum that I think was excessive. They could havedemanded a smaller piece (i.e. 300 million with 25 million a quarter) sothat the company could invest in things like knocking off more of thedebentures at big discounts or buying back shares to reduce ongoing cashoutlays.
Mark