I am disappointed with the offer. In 2020, at the peak of the IT boom, the market valued Damstra at over $2 allowing for the potential of the SaaS business. However, I believe we are now at the bottom of the IT cycle and the 25 cent offer for Damstra is a fraction of what it was. The factors driving the drop in price are temporary as, I believe, interest rates will settle in the year and Damstra and other IT companies that are cashflow negative have rapidly restructured and should approach being cash flow positive soon.
Given that the Scheme of Arrangement seems opportunistic. I am not keen to sell at the moment and I hope a competing offer will emerge. In the meantime I await the quarterly cashflow (due out by the end of Wednesday) and take hope that the announcement, last week, of Copia Investment Partners taking a substantial holding is the sign that a competing bid may be on the way.
I'm also disappointed that the indicative price was 27 cents and the offer is only 24 cents.
DTC Price at posting:
23.0¢ Sentiment: Hold Disclosure: Held
