Directors would not have been buying based on this transaction. They must have been already planned. the number was small.
Second, as for cash, if there is cash there, it may “belong” to the seller with only sufficient cash left to meet specific liabilities. This is normal.
Finally, based on 100 advisers, at market fees, CUP should be able to get up to $3m of revenue. Although licensees are not hugely profitable, you could expect an ebit of $750,000 to be added to CUP given synergies. This means it is value accretive at only 5 times ebit. It is not huge but it should a few million to CUP. It also provides them with practice acquisition opportunities to add more value.
so logically it adds about 5% to market value plus an improvement in sentiment about where they are heading.
CUP Price at posting:
60.5¢ Sentiment: Buy Disclosure: Not Held
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