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URBAN COMMUNICATIONS INC V.UBN

"Urban Communications Inc is a telecommunication company. It develops and operates telecommunications networks in urban areas and provides a full suite of Internet, voice, video and broadband application products."


TSXV:UBN - Post by User

Comment by LauraDoveron Jul 26, 2017 7:51pm
107 Views
Post# 26513974

RE:Interesting story - but not without overhang

RE:Interesting story - but not without overhangQuestion with regards to risk:

In the MD&A,  it says:
The Company’s publicly traded securities have reflected its operating at a loss, while at the same time not reflected its inherent asset value. 
 
The cost to build the network of UBN is $57 million (according to an independent assessment).  On their balance sheet, UBN had listed PPE at $8.7 million.  I am assuming that this means that they bought it cheap, during the "fibre optic fire sale"  (https://www.wired.com/2002/11/fiber-optic/)  It appreciated in value, which doesn't require a change in the balance sheet.

Their liabilities were listed at $7.047 million.

Does the value of the network not adequately derisk ubn?   If they sold the network, $57 million is 0.57 per share (based on 100 million shares)  Minus something for the capital gains.  Minus 0.07 per share liabilities.  

Any thoughts on this ... is it because they could not in fact sell the network for $57 million?


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