RE:RE:RE:Gents and Ladies
Mephistopheles3 wrote: You can see it from the analyst comments and from BNN, but most likely is private equity. There's a lot of money sitting on the sidelines and they have been hounding the CDN tech space over the last few month since many companies are sitting at really deep lows.
Most of these offers are quickly rebuffed - for example with CTS, a 30% premium would bring us to... 3 weeks ago? So there's a lot of vultures out there looking to pick up something on the cheap and there's a lot of resistance from the BoD level to sell at the bottom.
Private equity would work pretty well for them, they would get access to lower cost of capital to help continue their strategy - they are currently borrowing a few bps above prime which is at 5.95% and set to raise at next BoC meeting. PE have access to capital at lower rates than that.
At the end, I think it'll be an interesting journey to go through, but I am happy either way here - either we get a deal around $8-10 or CTS focuses on their core operations and improves their margins and cash flow to a point where the market rewards them for it. Current price of $5 is a steal either way IMO.
Agree, this price will not last long. Tomorrow could be more or less sideways, but Next week it will get $6+ easily.