RE:RE:Iceland? I do not believe the Iceland asset is up for sale or will be up for sale. I do not believe Mr. Beaty will part with it, unless someone is willing to significantly overpay for it.
· The last conference call Mr. Beaty mentioned that Alterra was the only renewable company he knew of with operating plants in Hydro, Solar, Wind, and Geo. The sale of Iceland would cancel this statement, which is good for marketing and positioning.
· Iceland might be the only reason the company survived this long, it has been the longest revenue producing on the top line and the longest dividend producing for the company. After years of “pain”, why sell the asset at the first moment of “sunshine”?
· What would Alterra do with the funds? Reinvest in projects in the US? Be careful here, management may use the cash on the balance sheet to cash out options, then what? Yes, there would still be funds left over, but if you have less cash and a management turnover. At 4.4% US unemployment have fun finding a better team at more affordable price
Remember the long-term: Optimism is still alive, it is what binds us as humans to reach for the star and accomplish something that has not been done before. People with no vision, well, they just can’t see anything and believe what was done in the past is sure to repeat itself. The iPhone wasn’t around and I believe it was innovated by an optimist, not a pessimist. Alterra is finding its way, perhaps not communicating it right, or the market is not appreciating it.
Currently, Mr. Market might not like renewable companies or utilities, but one day investors will rotate sectors as they have always done. When they do, Alterra will be very favorably positioned with its growth in production, diversity of assets (locations and type), longevity of team, experience, dividend, …
After building it up for years, why would selling it off the largest, most stable component make sense? To pay a one-time dividend? Not likely? To reposition assets in the US? Maybe, but they are doing that anyway and can achieve that without selling Iceland.
Patience, let the re-organization lead to results. See what happens with the board in a week. The company needs to breakout with production and projects as well as communicate its vision.
It’s one of my favorite days, who is watching the Kentucky Derby? Anyone have a throwback tape?
Bold Forbes