ALC Chart, page-1555

To be fair, volume up until capitulation selling in to the 3's in July 2016 was RTO sellers.

Then we had the Brian Leedman fanboy buyers (big spike in volume August 2016)

Then we had (imo) genuine accumulation of stock by not-so-small buyers (funds and large retail) Sept-Dec.

But then the PR/IR brigade (read Brian Leedman + Nathan Buzza) both abscond during 2017 (after their director selling escapades mind you), and the cold hard reality of the sales cycle to hospitals sets in.

It's frustrating because 2017 has seen consistent cashflow neutral (I won't call it CF positive till I see >$500k increases in a quarter) and some great MoU's. I agree, company is in the best position it has been to date, but I feel the excitement of impending rapid revenue growth that was present last year has been replaced by a reality this year. The delayed move to North America also hasn't helped either.

They will excite once again if they can sign MoU's of unprecedented size (say $5m+), start to accelerate frequency of deal signings and make good on their plans for entering North America. A left of field acquisition could also be very handy, though I wouldn't want them to be buying in more early-stage pre-revenue tech, because quality tech doesn't seem to be the problem here, it's sales velocity.

There is one factor that has sat in the back of my mind and that is the involvement of Blue Sky Private Equity. PE funds generally invest with a 7 year time horizon, and BSPE invested in ALC in March 2012, 5.5 years ago. However on doing some googling some very interesting info has come about:

- The BSPE fund that invested in ALC had a 5 year time horizon (shorter than the normal 7), and launched in 2010
- The fund has extended its runway to 2017, which means they're looking to exit positions asap
- The fund that invested in ALC has underperformed and perhaps is now publicly getting BS some negative press (it has literally provided negative returns over the 7 years of its existence)

So while I originally expected BS would be looking for an exit by 2019, they will be well and truly in the market with their stake now. I view this with a slightly optimistic outlook, because it's in no-ones interest, least of all BS's, to sell their stake at these prices.

I expect at a minimum they're working with management to explore avenues to get the valuation up, most likely through some type of corporate action (because I can't see how BS can influence the hospital sales cycle in any meaningful way). That could potentially be a strategic investor taking the BS stake, or something more integrated (such as an investment + operational relationship with ALC by a third-party). Really I'm speculating here, but two things seem clear in respect to BS: they can't sell out their position in the open market, and it's highly unlikely that fundies will take their entire stake off their hands around the market price. So with that being the case, they'll do as good PE guys do, and that's make a deal. The question is, with who, and will it be beneficial to them, or will it benefit all SH's? I'm tipping this, coupled with the injection of new management, will be a positive for all shareholders, but nothing is certain.

One this is for sure, as dead boring as ALC has been as an investment these last 10 months, there's certainly some interesting things going on behind the scenes.

http://www.couriermail.com.au/busin...e/news-story/6d22fde9db1a9221fe0235a6f971914e