RE:RE:RE:RE:RE:RE:RE:RE:This is interesting… Cabbie might be right Yes. It would be post the Apple decision.
This is consistent with Todd Coupland' discounted value of the $1Billion licensing potential of the portfolio excluding Apple. He removes the cost of licensing expenses and then applies a 15% annual returm requirement.
But, you don't necessarily need a CAFC decision. They could come to an agreement beforehand and be done as an industry license.
The benefit for Quarterhill would be manifold. They get the cash upfront, spend less on legal and licensing fees to generate the licensing revenue, and the valuation re-rating on the ITS segment. Lower taxes on capital gains vs income. They then have the capital to pursue ITS acquisitions and raise their 5 year target from $400M to $600-$800M. And a very clear path to $400-$600M revenue and $100M+ pure play ITS EBITDA.
The licensees benefit in many ways as well. They lower the cost of the fees. They have equal fees across competitors (no unfair advantage). They eliminate a formidable patent assertion entity from the marketplace.
My main point in this illustration is that when you have an asset that is valued by the market as -30 million and there is real value there, there are many ways the company can surface the value.
Here would be a Big Swinging D!ck move. Sell WiLan, Buy Kapsch at extremely depressed levels, change name to ITS International, company would be $700-$800M revenue. $120-$150M EBITDA, on $600M of leverage. Would be debt free in 4-5 years and valuation would be $20/share by 2025.