StockMagician wrote: LOL 50% of cash value? Come on now, you and I both know that while it has dipped well below net cash value numerous times in the past, after the GFI deal closed, it has never stayed down that low for more than a week or two.
If Sicpa wants the rest of EUO, they probably look at what the net cash value is for the company, add on the remaining amount of the royalty payments, then offer a 20% premium. I don't know if management would be happy about it, but as they don't have a huge shareholding, who cares? The rest of the shareholders would probably jump at this, as I don't believe they are getting any credit for the value of the royalty stream, mostly because the expenses, meaning losses, more than eat it up every time a payment is received. Would you take 14 cents for your 9 cent shares if you could on Monday? I think most longs would jump at the chance.
I would expect that the instant they suspected that GFI fuel marking was about to take off, they'd be trying to buy EUO for an amount like the above. Well, we'll know in a week or two what the remaining net cash level was at the end of June, and we know SICPA hasn't offered didly for the company, so I think the current down trend will continue. If a GFI deal for the EU is at best many quarters away, then SICPA has no reason to make an offer for the company in the near term. They might as well just wait right? Or should they grab it now, while at near net cash value, and turf the people sucking up all of the current cash and keep it for themselves?
Basically with my takeover offer guess above, they would be buying net cash at par, buying the royalty they owe at par, and kicking in 20% for Xenemetrix, XwinSys and Croptimal, which they could then keep or spin out as they pleased. It seems like a win-win deal, but as it hasn't happened yet, perhaps they aren't at all interested. Maybe this is because they no longer believe GFI can be the money maker they hoped for when they bought it, or maybe they see some other problem I'm oblivious to.
I don't think SICPA would have to or want to sweeten the pie for Doron or Bruce.
kidl2 wrote: No one can buy EUO unless it’s SICPA. SICPA’s 20% plus other insiders plus disinterested parties make this impossible.
IF SICPA wants EUO, they will short the stock down to 50% of cash value, offer a 20% premium, sweeten the pie for Bruce and Doron likely by just handing the X’s to Doron who will try to spin the 2 X’s off into another public company since they can’t exist as a self-funding going concerns. Croptimal is a zero sum game as it can’t exist without Netafim. It will likely just fade into the sunset.
Doing this, SICPA will spend as much as they would have spent on remaining royalties and they can take Petromark out of the lamplight they hate so much.
I don’t actually see SICPA making this move as all they have to is wait. EUO is self-destructing as their cash is going down.