possibly best announcement ever

The announcement (which doesn't seem to be showing on Hotcopper) of the new director Shaun Collopy is fantastic for MWR. Given the background of Collopy this is an outstanding coup for MWR. I’ve done a little reading and a bit of research and thought more about this.

This message can’t really convey how excited I am by this. Let me tell you why.

Collopy (with a partner) built Mobile Messenger into a significant business. The MWR announcement says that it is confidential, however the 2007 accounts for Mobile Messenger Pty Ltd are actually available to the public. The 2008 accounts are not available, but given the growth in the 2007 accounts I reckon 2008 would be pretty good.

In 2007, Mobile Messenger had revenue of $118.2m an increase from the $52.9m earned in 2006. That is huge growth of 123%. But let’s look at profit... 2007 had profit before tax of $15.1m an increase from $4.4m in 2006. This is an increase of 243%.

ASIC records suggest that Collopy owned 20% of Mobile Messenger, so with the private equity transaction of a valuation of over US$200m, this would suggest that Collopy received, or has value of approximately US$40m. Even taking out tax this suggests significant wealth (not bad for a guy in his 30s... Collopy is 33). By the way, Mobile Messenger paid a dividend of $8.7m in the 2007 financial year, so Collopy I expect that Collopy received 20% of this.

The announcement quotes Collopy as saying he wants to help grow the company revenues further into new services and markets.

Given Collopy’s experience and position, if MWR doesn’t grow substantially, he has significantly more to lose than he has to gain... so it is fraught with danger and reputational risk for Collopy if it doesn't work.

This gives me massive confidence in MWR and what it can achieve. I reckon that in 2 years down the track, MWR will be such a larger business than it is today.

My key request is that Collopy significantly increase his stake in the business to show his confidence in the business and to much more greatly align his interest with shareholders. It might also boost the share price. Unfortunately he won't be able to buy until after the 2009 results are released.

Cheers
Marvin

DISC: I own MWR shares and plan to buy more (can someone please sell some on the market now?)