Vocus group, page-148

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bug1

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15/05/17

22:35

Post #: 24704631
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Originally posted by DrDante ↑

I'm not going to spend the time responding to that question. Shareholders stumped up billions in equity at higher share prices to pay for these assets. They paid top end multiples and were empire building out of fears that if they didn't buy it someone else would and they would be left sub scale. Assumptions to justify huge prices paid were bullish on both earnings, synergies and lower integration risks. The shareholder returns are disastrous let alone factoring in the fact shareholders have tipped in billions in raising a on the way up. I don't have time to explain this but have a look at precedent transactions, trading comps and other valuation metrics used for these deals and look what Vocus is trading on now. I rest my case - overpaid.

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Its a very bad situation for investors who stumped up 3x current share price for nextgen share issue, but its a good situation from the point of view of current debt.

Vocus didnt overpay with cash, but they took advantage of the overvalued SP. I think that bad sentiment has played a part in knocking the SP down as far as its is.

There is saying, 'Friends come and go, enemies are forever', and i think it will take some time for those insto's to get over it.

Last edited by bug1: 15/05/17

VOC Price at posting: $2.50 Sentiment: Buy Disclosure: Held
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Vocus group, page-148

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