Another piece of Financial Engineering... I was quite interested (and admittedly impressed) in how the company traveled when it was newly listed. The multiples at the time was for IP that has disappeared. The major problem with this business is that they have not re-invested into the technology platform they have. That should have been the primary use of the IPO funds. Not new offices that are 1/3 filled. They have moved their business to other (competing) vendors and are losing customers from their traditional product set hand over foot. Yet all they continue to do is financial engineering. I thought that some of their initial acquisitions were quite clever for all parties involved. Now unfortunately it looks like desperation stakes.
The ASTA acquisition is nothing but a reverse takeover. All shareholders who bought the dream of an IP rich company with global potential have been somewhat misled (I am not accusing anyone, it's just an opinion). The TNT team are for the most part a good bunch of guys that want to do the right thing by their customers. Unfortunately that isn't permeated through the technology. I hope that the ASTA acquisition goes ahead, otherwise ASTA will pick it for cents in the dollar. And I dare say there may be more companies willing to pick up the customer base. The good news is if it does go ahead, the company will survive but the bad news.. it will be re-rated into a services company.
