TSN- Spec Buy. Target 6-7cents, page-362

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teagar

26 Posts.

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29/06/16

08:59

Post #: 18147323
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Originally posted by jonkey1995 ↑

My basic maths using the following assumptions:

CX Partners put in 22.13 m on 13/08/2103 ( I realise it was 2 tranches but did this for simplicity};
Assume transaction in AUD only (ignore foreign currency);
Internal rate of return 25% for CX, thereafter 80:20 split on additional;
My estimated IRR required is approximately $43,400,000 based on 3 years before 80:20 kicks in;
Market prices us at $42.29m

Therefore, IMO, the market is pricing total enterprise value as:

42.29m= 0.25X +{(0.75X - 43.4m) x 0.2}

If I remember my algebra correctly from school X (enterprise value) is roughly $127.43m. Therefore our current economic interest to August according to the market is 33.19%.

This is only rough rounded numbers. The market (via TSN) prices TSI at roughly $127.43m. I think it is worth more, but time will tell. It is in our interest, IMO, to move CX on quickly as 25% IRR per year adds up and may dilute the effect of the 80:20 split above the 25% IRR depending on growth rates.

This post is solely for some weird entertainment purpose.

Cheers

Expand

As you rightly say jonkey1995 CX partner put in 22.13 Million. However this was for 75% share in the Business. Is this not TSN's money that has been kept in TSI to help accelerate growth? Could this be used by TSN to pay CX partners for 25% therfeore increasing its interest to 50%. CX partners still make a profit, and also sell there other 50% on buy trade sale or IPO and TSN investment in TSI has grown.
Win win all round.

TSN Price at posting: 2.2¢ Sentiment: Hold Disclosure: Held
4 Upvote

0 Great analysis

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