Chuxa you’re a passionate holder but I have to respectfully disagree with a few of your statements. But first, there are some valid points you make. Legal costs will go up and it will eat up some management time - legal costs will be annoying and the time aspect I don’t see as a major issue. Beyond that the company is resolving something that they’ve said hasn’t been working in terms of the JV.
The point that
@Klogg, myself and others are trying to make is that this WILL get resolved. Do you not think that’s good for holders? We also think that anyway this goes is good for us - except no decision of course if that’s even possible.
You talk about uncertainty but investors are forward looking. This will be done and dusted in 9 months or less. That’s actually an outcome even though know one knows which way it will go.
What happens when a decision is made?
We are forced to sell and get a $20m to $40m cheque? Is that not a good outcome? It’s great when our market cap is lower than that! What do you think we will do with our Zoleo equipment margins? I can pretty much guarantee they won’t be sold on razor thin margins. Again, is that bad for us?
On the flip side, if we win we buy their half. If you look at the subscribers they have the vast majority. ~85% from memory. That’s a lot of royalties. But we buy 50% of the equity but get 80% of the earnings as RP have the better territory. Think about that - you’re buying 80% of the earnings but paying for half of the business. That sounds good to me. That also means we will be a much bigger business which puts us on the radar of funds, provides scale efficiency etc.
To say inflammatory comments like people that see this as a positive are delusional is counterproductive and a bit disrespectful particularly when arguments have been made for our views. This forum has always been pretty good compared to other stocks I hold. Let’s try and keep it that way.
Finally you talk about having to hold this for another 2 years. Per above this will get resolved within that per the announcement - I see that as a huge positive catalyst and will position accordingly. Secondly Zoleo is immaterial from an earnings perspective to BCC now, while the main business is firing and growing. Legal costs will impact earnings but are one-off - the market looks at underlying earnings, but it will impact cash. Fortunately we have plenty of cash. Either way our operational performance should be strong.
As an aside, I do think it would be good to see the chairman make a few on market trades. Now that this is out I can’t imagine there’s a blackout so no excuses now.
The next webinar should be good.
(20min delay)