Forum Topics Two takeovers in 24 hours
Strawman
2 years ago

Yet another takeover, with MSL solutions being the latest to be snapped up by Private Equity -- as reported here by @TycoonTerry

The premium paid is, again, significant. A sign (perhaps) that many of these small cap tech companies are trading well below fair value. (or, maybe these PE firms just have too much cash and are yet to adapt to the 'new normal' of market pricing..)

We spoke with MSL CEO Pat Howard in October last year if you're interested (see Meetings page). Although, with the board recommending the deal there may be little point at this stage!


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Mujo
2 years ago

JAN also being looked at:

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TycoonTerry
2 years ago

Like I needed another reason to procrastinate. But if @Strawman is going to call out my posts I might find myself on this forum instead of studying for my uni finals

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Rocket6
2 years ago

I am also a little torn with this one. A significant premium being paid, so those who invested in the last few years will be making a tidy profit. My average purchase price was around 18c. But despite likely being handsomely rewarded in this instance, I think Pemba are onto a winner -- and are ultimately purchasing what I still deem an undervalued business that is attractive and capital light. My last valuation on this site was around the 47/48c region; I still think this is roughly about what I consider a fair target price.

Agree though @Strawman, and I think this supports the current trend we are seeing -- big firms swooping at what is broadly considered cheap valuations across the board. Don't get me wrong, there is a lot of crap floating around (companies) that don't have clear paths to profitability, but I don't think this is fair to say of MSL. Their last 12-24 months as a company has been nothing short of impressive, and in my opinion we were well on track for seeing a dividend-paying company in a few years' time.

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TycoonTerry
2 years ago

@Strawman perhaps the next deep dive should be more targeted at looking for takeover targets. Not really the spirit of this page I know.


But upside via doing what we already do (underpriced companies with a runway and either a strong balance sheet or approaching inflection point) +/- finding those babies gone with the bathwater that PE are swooping up.

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Solvetheriddle
2 years ago

Two of my small "spec" positions have been bid for in the last 24 hours, PTG and NTO. they are not alone. what does this mean? well, imo it means that the spec area has probably been hit too hard and as long as your company is not cash burning its way into oblivion you should hold on and if the biz is doing ok add more. the USD is too high and this is encouraging any US financing to look at cheap $A assets as well imo. so a double whammy. hang in there with reasonable spec positions is what i take away.

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Mujo
2 years ago

Looks like RDY could be up next too.

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Rudyboy
2 years ago

No doubt there is a heap of cash in Private Equity right now looking for a home and a lot of tech stocks are very cheap. With interest rates going up around the world PE needs good and profitable buys to keep up their margins.

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