You're on to it .. are you interested in a new day job @ SKT HQ ? :)
There seems to be large void there in need of some real good talent ..
at a very high level
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Those reports about the transaction probably being $220M + in order to require a shareholder vote…
Well, Christ Almighty - NZME is only valued at $245M and they are a much better business.
Why wouldn’t we just merge with them instead? Don’t even need any cash to do it…just a straight share swap.
Still plenty of cash for buybacks and divvys…
And a SKT-NZME entity would be far better than SKT-MW.
The whole thing is just infuriating because it’s so damn stupid.
I’d prefer to get the SP up first with divvys etc and then merge with NZME. But if these arse clowns are going to do something stupid pile buy MW then I would take the NZME merger now instead any day.
There is a slight problem Muriel
Everyone around the negotiating table thinks a large $100m + Loan Liability is an Asset
And a Slightly reduced Loss for last FY means a record Billion Dollar Profit the next year
over the Airwaves and Billboards everywhere.. even those facing down towards the ground
No-one has been able to determine why their rough back of envelope calculations
are wildly out of wack and where the large imbalance is ;)
If any shareholders do wish to exercise their rights for a buy back the relevant sections are
section 110
https://www.legislation.govt.nz/act/public/1993/0105/latest/DLM320496.html?search=sw_096be8ed81c295af_buy+out_ 25_se&p=1
section 111
https://www.legislation.govt.nz/act/public/1993/0105/latest/DLM320497.html?search=sw_096be8ed81c295af_buy+out_ 25_se&p=1#DLM320497
investorrelations@sky.co.nz
investorrelations@sky.co.nz
But the company press release says the transaction needs to pass by a simple majority (so just an ordinary resolution, not a special resolution) whereas a major transaction would require 80% under the legislation, presumably then this isn't actually expected to be a major transaction - so why the need for any vote at all - I'm confused, can anybody throw some light here?
Can someone prepare a template email with [insert name], [value of share held] and etc we can copy paste, fill and email to investorrelations@sky.co.nz ?
If the board are serious about the purchase, I hope they are not extrapolating profits of cash flows. MW has been losing cash over last five years. 2021 was slightly cash flow positive, so a dunderhead SKT director must see that it follows that within the next five years it will be a gold mine. Have to pay based on the fifth year extrapolation. A real Tui moment.
I believe we may be looking at a reverse takeover of sorts... hear me out.
We can see from financials that it basically isn't a good purchase if we have to pay for it and assume the debt. So why the hell would Sky be looking at it, and saying that it'll need to be voted on by shareholders (indicating the transaction is >50% of market cap). Are management really that stupid to pay a large some for something that doesn't really fit and carries significant risk???
What if Oaktree and Quadrant realise that they cannot get out of their investment without merging with another undervalued company. What if the deal proposed is a merger, with Oaktree/Quadrant paying shareholders for say 51% of the shares and Sky distributing the cash on balance sheet prior to shareholders. Shareholders would need to vote on that.
Sky then becomes a bigger vehicle, that can be further sold in future as it could be a strategic asset for several companies.
Hmm you're right. In that case, the approval by ordinary resolution is likely not something required by listing rules. Instead, it is in there to protect the board by having shareholders vote on the deal. It would also be a condition of any contract before going unconditional.
Essentially if we aren't getting paid for MW (i.e the deal isn't favourable) then we can vote no and the transaction won't proceed. Nothing to worry about, expect potential competence of management.
Simply Wall Street values SKT at $3-41, and Value Investing at a whopping $4-35. When I go for a minority buyout I am opting for the $4-35 per share. Woohooo. Management just wont let it get to the vote. I am not sure if the buyout is triggered by the successful resolution or after the actual takeover.
I think there was plenty of chatter about Stuff buying MW to become a fairly similar entity to NZME (radio & online news/newspaper assets and some other advertising operations). Makes a hell of a lot more sense than Sky buying them. It’s possible MW got sky on the line just to drive up the price on any Stuff offer, but then they discovered sky was willing to pay silly money so then became the bag holder target.
If we assume that it is very unlikely that Sky will proceed with the purchase of MW. If Sky doesn't get taken over and there aren't any other targets for acquisition, how does the board justify not providing a dividend or capital return? Maybe the board have something else up their sleeve?
With the wording of the annoucement it is possible that Sky was encouraged to looked at MW and complete due diligence. The annoucement states that there is a high degree of uncertainty. In my mind that would suggest that the deal is unlikely to go ahead until further information becomes available. Add the market reaction and analyst comments, I don't think Sky will proceed. If we assume Sky doesn't take over MW, is Sky now required to make another annoucement as soon as DD has been completed to propose a capital management plan?
Fonterra shares jump after share buyback programme announced
Oh look! an appropriate management response to an undervalued share price! imagine that?
Fonterra said it plans to spend up to $50 million on buying back its own shares from June 30.
The move is in reaction to the steep decline in the share price following Fonterra’s announcement on May 6 last year to restructure its capital base.
The shares, which can be owned only by farmers, closed Tuesday at $2.50, up from their record low at $2.22 late last month but down from $4.56 on May 5, 2021.
Chair Peter McBride said Fonterra has “looked at prevailing prices” alongside the co-operative’s strategy and overall business performance.
"Fonterra Co-operative Group's shares were also up 14% to $2.85."
So share price went from $2.22 to $2.85 in2 days .....
Meanwhile at sky.....
@Snowy, what's your thoughts on this, TIA.
Except that in the general course of things...(which you may well know but maybe some others don't)
- Posters on Sharetrader highlighting that their going to vote no are unlikely to tip any company vote to no given share registries are dominated by institutional shareholders.
- Companies canvas the support of the same institutional shareholders BEFORE making any public comment or disclosure to public markets to inform the rats n mice retail holders.
- Name one company proposal voted down by retail holders on the NZX in the last say 20 years......?) ((Tip: There are none))
- While colourful...the last 10 days of posters probably hold less than 5% of the registry in aggregate. (could be wrong but doubt there is anyone in the top 20 posting on here..no offence)
Clearly very uncertain but the market appears to be surmising no capital return and no divi..
GLTA
Although I agree with most of what you’ve said there moimoi, unless there is no real skin in the game for the institutional holders (I.e. they are managing OPM only and don’t give a s*** what actually happens), surely they, like us, think that this deal sounds like an epic waste of $?
I haven’t seen a single person on here or hotcopper say “hey, this kinda sounds ok/good”
Yes, 92% of shares controlled by those 9% of shareholders that have 100K+ shares - so obviously Sharetrader posters represent a relatively small percentage.
But as you say, the deal still has to stack up to get enough insto support. And I am sure they are scratching their heads as much as we are about this deal.
If SM announces a deal with MW - it is going to have to be very compelling to get the support.
And that will ultimately come down to price and how good a story she can spin about synergies and growth opportunities.
She would also need to make sure some sort of dividend is still paid I think (the bribe).
It’s a tall order I think.
They will hammer away at the “cross promotional” benefits/synergies no doubt.
Once we merge we will be the one-stop shop and preferred advertiser etc as we can offer attractive TV, radio and billboard packages to maximise your reach.
And, to be fair - that would be true.
However what is the upside to that realistically?
If combined advertising revenue is $280Mish…a solid 10% increase only pushes revenue up by $28M.
[QUOTE=Rustycage;961189
I haven’t seen a single person on here or hotcopper say “hey, this kinda sounds ok/good”[/QUOTE]
Need new glasses?
This looks like a TalkBack show with wannabe CEO's saying I could do that better..
I legit think we could (lol). Here's a script I prepared earlier
---
RC meets with Oaktree
Oaktree: Hey RC, wanna buy MW?
RC: NicholasCagelaughing.gif no
Oaktree: But synergies/empire building etc
RC: GTFO here n00b, I've got a polo lesson/yacht party/gala dinner to get to
Later: RC meets with Board
RC: Hey board, now that we've crashed the share price, let's do a massive buyback/reinstate the dividend. This should facilitate an increase in our share price, create value for shareholders and start to save our reputations. At that point, our shares would be a far better currency to look at acquis/merger with a telco/NZME/strategic asset. If we work on saving our reputation now, even if this all goes to s*** and we get taken over by PE, when they figure out that we are fairly hopeless and we all get fired, our intact reps should allow us to get jobs on boards of the next NZ s***co
Board: Hooray for the SKT board! Bring out the Krug!
At the risk of appearing bi polar, i have been thinking more objectively this am about why Sophie would consider this to be a good idea.
We have to give her credit she has done a remarkable job in the core skt space this far after being handed a hospital pass.
Maybe her strategy is a little more future orientated than we think, especially around Renewal of the rugby in 2025.
Outdoor advertising is actually a growth sector in media, and was substantially increasing pre covid. This could be where some of the “40m” ebitda impact was felt.
over in Aus, i stumbled on a picture of who the bigger outdoor advertisers were, low and behold number 1 is Stan sport. This i believe has helped drive Stan sports growth. foxtel is also down the list at number 8 (jumping from 40) from the year before. So the outdoor space in aussie is a real big player for our “friends” at foxtel. This could be gold when rolling out STB boxes, and help with broadband.
What if the oms part of mediaworks has suffered from lack of invesment while PE has been trying to exit? could be some growth there.
https://www.oma.org.au/Industry-Performance
Now i come to Radio, the dog. This could actually be quite a lever to pull when it comes to securing sports rights, especially around event promotion, upcoming games, getting the stars on shows etc etc. Also radio could be gold when rolling out STB boxes, and help with broadband.
With outdoor and radio in the quiver, i think skt can pitch for sports rights (especially rugby) and it doesnt always have to be about the pure $$ they are paying. they have other angles they can sell why Sky should get the rights that frankly spark or others wont be able to provide (we can give you $XX m of advertising for free), they would have massive reach through kiwis eyes & ears.
Having said all the above, im not for the deal, im just trying to get inside Sophies headspace, as i do not believe she is silly.
I agree with you that Sophie has been admirably level headed and focussed on delivering on SKT strategy, which it makes it more "perplexing" (Forsyth Barr) that they would now go for a risky acquisition, before the strategy has even been fully executed.
As MistaTea has said, SKT would have to get MW for basically zero (acquiring $100m in debt) to even have a hope of this making sense financially. Even that is optimistic given the forecasts of a 30% decline in radio/billboard advertising in the next few years. And that this is an ailing, loss making company that PE are desperately trying to offload (padding the balance sheet with intangibles in the process).
Some commentators have estimated that SKY might be considering paying anything from $100-200m. That would put the SP into freefall and wipe out a third of SKT value. And the SKT Board's attention would be diverted from executing their successful strategy to trying to overhaul MW, in an effort to prove doubters wrong. And all that freecash would have gone and the company would be saddled with long term debt in a rising interest market.
I pray to any passing God that SKT are already rueing this move and will shortly announce that the due diligence is over and they won't be pursuing it any further.
I don't buy it being a great move strategically.
They overpaid for RP with a rationale that it would help keep the rugby rights. That turned out to be bollocks.
The idea that NZR/SL would turn down more cash from Spark Sport because we will give them some ads on The Rock is laughable to be brutally honest.
Yeah I get that - and believe me...despite my negative posts I have tried to ponder the various angles to try to 'make it work' in my mind.
And no doubt SM must believe there are big benefits to justify going this far in negotiations. I am sure Cam Wallace and his bankers are also 'helping' SM a great deal with her thinking...
Might have been on the WHS thread, but discussion about Joan Withers, who is a director of both WHS, but also SKT.
She was previously CEO of Fairfax but also The Radio Network, albeit a number of years ago. So presumably must be a large part of the decision making?? Doesn't seem like the rest of the board have much experience in radio but.....
Why is SKT not in a trading halt on NZX while this is going on ?
Obviously it may materially affect Share Price and value of the company
In other markets like OZ this sort of thing may well trigger a halt
The only rationale that holds any weight for Sky buying MW is that that the two companies can grow advertising revenue significantly together. Businesses will find Sky TV the 'no-brainer' to go to for their advertising because they can offer bundles across TV, radio and billboards - which would ensure maximum reach with one convenient bill.
That is great, but how much upside to revenue can we really expect from this?
Even if they boosted ad revenue by a whopping 20% (a Herculean task at the best of times, near impossible in this inflationary environment with possible recession looming) that would be maybe $50M more revenue. I mean, the upside just isn't enormous...yet the risk is very high (and certain if we overpay, which I am sure Sky will).
Any notion that owning a radio station and some billboards will make us a more attractive prospect to content partners (particularly sport) is just wishful thinking. No doubt this angle is being pushed by the 'helpers' on Page 12 of their glossy presso...
"Hey NZR! You really REALLY wanna go with us even if we won't offer to pay the most because now we can reach every single home AND car in NZ!!". I mean, come on.
That's a good point. The NZX is much slacker than ASX when it comes to disclosure, so I suppose SKT are playing within the rules. Maybe they naively thought they could carry this out without anyone noticing and if the due diligence came to nothing, no-one would be the wiser. Not quite how how things worked out and again it throws the SKT Board's judgment in a bad light.
But with the way the economy is going & broken skeletons of businesses crawling out from under the Covid debri, would there be any net gain, or merely arrest the freefall a bit on potentially worse scenarios ?
I'm sure the PE holders of MW would have already tried to milk any possible gains & efficiencies out of the
can of worms long before now .. why did they not do a partnership joint bundling deal with SKT
long before now if the concept looked so good ?
Probably a good question to be directed to the NZX.
Talks are said to be 'advanced' and 'exclusive'...so very far down the track despite them saying the outcome is still uncertain. Given talks have gotten this far it is fair to say that it is more likely to end in a deal than not (unless the negative media and shareholder backlash - both in terms of online forums and the fact the SP has crashed below where it was sitting even before the takeover chatter - causes the Board to make Sophie kill the deal).
But given SM is probably going to present some sort of a deal to shareholders soon...it is interesting that the shares are still allowed to trade now that you mention it.
People are dumping shares without material information being made available. And Sky can't release the terms and price until they have signed a deal with MW. So a trading halt would have certainly calmed things down and given some time for the market to digest the news, get the terms of the deal and then resume trading with a clearer head).
Outdoor advertising signs are pretty intelligent these days
There’s one that says ‘xxx electric vehicles have passed this spot today’ ….getting you to buy a EV
Apparently there’s a camera that can read numbers plates built in and connected to a database somewhere and so can count the number of EVs
Wonder what other stuff they can do
Cool eh
No need for a trading halt when this happens
"under the current proposed transaction structure if an acquisition of Mediaworks proceeds, itwould not require Sky to raise new equity but would require approval of an ordinary resolutionby shareholders at an Extraordinary Shareholder Meeting."
transaction 'structure'...
This is my prediction...Sky will want to work this in a way that still allows them to pay out a dividend (in other words, allow The Board to keep their promise).
But how can you do that as well as make a significant purchase when you only have ~$150M cash (and require some of that as working capital)?
Well, given the wording in the notice...I think SM will announce a deal that includes part cash payment and part issuance of SKT shares. 'Transaction structure' certainly sounds more complicated than just a cash payment - and given the kind of money MW seem to be expecting, we can't afford to buy them with all available cash (even if we were happy to forgo the dividend - which we aren't).
As I see it:
PE sees Markets in Freefall and badly wants out of MW
Message to Sophie - Screw PE down harder than hard as .. worse than putting them through the wringer ;)
They know there is punishment on the way ;)
Take them captive for a ride if it must be - in form of some ongoing SKT stake - not a major one,
but enough to keep them alert, assuming that taking a Lemon on board is even feasible..
PE have few if any other viable options on where to turn to avoid wearing market carnage ..
they know that MW will likely bleed bucket fulls of Red going ahead if they stay in there as is
if MW doesn't capsize along the way.. for want of further support needing to be thrown in
Sure, but let's say SM did amazingly well and beat them down to $130M (considering their independent valuaiton seems to point to $150M, and they may want more)...
Well, if they want to do a dividend, lets say they go $80M cash payment and $50M equity. At the current low SP that would mean we give them 10% of the business as payment.
Not great given our low SP...and especially not now that Sophie and The Board have managed to drive our shares down even lower.
I would say PE have 100 million reasons to want to navigate out of potential tight spot going forward
Most would be wanting considerably better than $20 mil to even start looking for an olive leaf, otherwise
leave then to traverse their destiny in the coming storm ahead ;)
SKT has successfully pulled off it's own righting of the ship more or less
PE need to recognise that doing the same for their MW wont come cheap or with any free gifts
in fact hopefully with massive discounts on all the china in the cupboard - close to a liquidators sale :)
Yeah, the other part I forgot to mention is The Board will probably want to retire a big chunk of the debt. Let's say $50M.
So even if SM could beat them down to $100M (still not a great deal imo given it is an EV of $200M)...
- $50M cash payment
- 10% of our business
- $50M debt payment
- $30M FY dividend
And don't forget, the very fact that they need to take this deal to a shareholder vote implies a $200M+ price tag.
Now, who in their right mind would pay $200M+ (EV $300M+) for MW? It would be insane.
When we bought RP there was no shareholder vote, because the purchase price was below the threshold. So the fact we need to vote should be very alarming (and clearly is given the crash in SP).
We seem to lurched back to bad old days when everyone was baffled/frustrated/ angered by an incompetent Board who seemed to have the Midas touch in reverse where everything they touch turned to lead. And we all hoped and prayed that someone would come along and takeover SKT and put us out of our misery. That period near damn broke poor Ogg. Maybe he was right after all in selling up when he did and move on and get psychiatric counselling. I am tempted to do the same :scared:
holding sky feels like I have a golden goose in a cage and rather than laying eggs all it wants to do is pluck out its own feathers... what to do what to do... If this goes up for a vote I'm out at any price. Not sure I can bear anymore suffering from this absolute train wreck of a company.
Beginning of April SKT shares were at $2.93 on the prospect of a return of capital. If SKT had honoured that promise shares would be over $3 now and there would be a real buzz surrounding the business.
Flash forward 2 short months and SP is $2.34 and continuing to fall, with the real prospect of crashing well below $2 if the deal goes through in whatever form. And SKT has lost $70m in market capitalisation, in the process making it vulnerable to lowball takeover offers. All of this self-inflicted by a Board that just couldn't seem to resist playing with fire. It could have honoured it's commitment to shareholders whilst still having enough cash in hand to grow the business in an orderly, sustainable manner.
But no, it got it's head by turned by self-serving brokers and PE vultures throwing them a few bones. Yep, Ogg will be glad he got out when he did.
I agree with you mistaTea, should of been put into a TH with a potential purchase pending, we are all losing with price going down while waiting for an announcement.
I think another possibility behind the motivation for this deal is that the planned growth drivers for Sky may not be performing as expected. Streaming services around the wall have all recently hit a bit of a brick wall in terms of user growth - its possible Sky is also experiencing this with NEON & SkySportNow. Add the other big hope - Sky Broadband - into the mix, and that also might be doing less stellar than expected as it struggles to compete with the stickiness of the big players mobile/Broadband bundle deals, especially with a newly resurgent 2 degrees.
In other words: Desperation. Desperation for revenue growth might be driving this deal.
Conviently forgetting ,the markets in a big downtrend here and globally.
What a bunch of downramping sadsacksyou all soundlike.
How bout selling off your shares and crisping up your "insider" egos on a stick with marshmallows on a fire using up some $100 bills from the share proceeds.
I'm sticking with the company and supporting management at the very least until they share with us the plans of this company (to grow and prosper ) thatI ive chosen to invest in.
Well, nobody is going to disagree that the final verdict will be in when we have the details of the deal (assuming it goes ahead).
But your position doesn’t seem to be that you actually see any merit in the deal (you certainly haven’t mentioned what you think could be the big upside here? Unless I missed that?).
So you want to sit tight and just believe management is doing the right thing unless and until they prove otherwise.
Nothing wrong with that at all.
But sorry, you don’t get to just throw grenades at the rest of us who have serious questions about the strategic soundness of investing in an asset like MW (regardless of price). We are actually allowed to discuss the possibilities, and express angst where we don’t see a deal making sense.
If that doesn’t suit you feel free to avoid the forum.
This is quite stressful for all shareholders. As Cindy says, let's be kind to each other :). We all want Sky to do well... My understanding is that the bulk of investment houses are generally adverse to the transaction or see it as something that is negative.
Who is going to be collecting advisory fees paid for from SKT for glowing reports on this miracle addition of undetermined untold barrels full of hidden prosperity arising from walking on troubled waters, at a time the market splutters & coughs ? ;)
Will the disclaimers & provisos in the reports be longer than the Wall of China ? :)
Chill, folks.
MW is not a done deal and if it gets done, directors of SKT need to come up with a very very very convincing case of why it is a good deal.
Until then, SKT’s track record since the recapitalisation has been pretty good imo.
There are several big boys in the stock and they are looking for a profitable exit and/or a great ongoing story. The volumes traded suggest they are watching and waiting.
Things not too bad ….Herald market update
Sky Network Television was down most of the day before rising 3.8 per cent to $2.84, picking up some ground it lost yesterday with its surprise announcement that the network wasn't looking to be acquired – but to be the acquirer.
No, it isn't a done deal but even if it doesn't go through, no matter how you look at it, SKT have inflicted unnecessary reputational and financial damage to their company. If they turn the deal down and announce some capital return to shareholders, they might recoup some of the losses, but they still wouldn't have covered themselves in glory.
And, heaven forbid, if the deal goes through - even at a rock bottom price - I remain firmly convinced that many people and institutions will exit their positions. I predict $2 per share if they proceed with the deal. We'll see how many holders remain chilled if that occurs.
Yeah that is very true.
If Sophie gets the deal for a ‘bargain’ at, say, $50M (plus inherit the debt) it would be interesting to know why it goes to a vote.
Ass covering by the board?
Doesn’t really instil confidence if the board sign off on a deal but then want to make sure there is no blow back on them if it turns to sh1t.
Well, good luck with that. History is littered with companies overreaching and their "good deal" turning very quickly into albatross's around their necks. I'm not saying that will happen, but SKT Board haven't yet done enough to earn confidence of shareholders in their decision making ability. Allowing their Chairman of the Board to not even live in the country is a case in point.
deletedelete
deletedelete
deletedelete
deletedelete
And we're back.
Another day another 5c off the SP - all in a days work for our much valued Board.
I was remembering that the loss making) TV arm of MW was sold to Discovery for $20m and one can argue that that was the pick of the bunch, given that it included several entertainment channels, a streaming service and news/current affairs NewsHub. And from memory I don't think Discovery took on any debt with the deal - that was left for some other sucker to take on board. Enter Sky and talks of spending anything from $50-100m for for leftover radio and billboards. Plus $100m in debt.
I am increasingly of the opinion that if this is to go ahead it would have to come for virtually nothing upfront (ie 100m incl debt). Rather like the $1 paid to purchase STUFF News.
Yes even getting MW for ‘nothing’ and inherit the debt makes the mind boggle really.
Even paying $100M (the debt inherited) for an asset that doesn’t currently earn anything and has minor synergies at best…is a stretch to the imagination.
The only way I could swallow this would be if the Oaktree gave MW to us for free and went halves on the debt.
Even then, when I think about the opportunity cost of ruling out a NZME merger in the future…probably also ruling out being purchased by 2D… I would still think the deal is shortsighted.
I think the odds of shareholders voting for such a deal is very low, if not zero.
Really? Surely they canvas larger shareholders so as not to be embarrassed at the vote.
This board, and its absent chairman, are, without a doubt, the worst of any company I've ever held.
https://media.giphy.com/media/QGzPdY...-downsized.gif
They will have canvassed some opinion form big shareholders to test the temperature on a deal in principle.
I know of one large insto that has spoken to sky…but that insto does not have any info that we don’t have about MW (sky have to stay tight lipped with everyone).
This insto has said that they will keep an open mind, but that is as far as it goes. Obviously everyone needs to see the terms of the deal, and get a feel for MW’s latest earnings, as well as understand what kind of projections these guys have more for future earnings…
But this particular insto is more interested in getting sky to honour their divvy commitment and pay top end guidance.
Reading this story reminds me of that guy.....maybe 30 or 40 years ago who was so in love with Channel 3 when it was listed that he bought up 7 million shares just before it was de-listed from the NZX. He finished up with nothing of course. I try not to think about him before I go to sleep.:ohmy:
Nothing like a prospective takeover to show their hand when the target company wants to spend its cash and buy a losing business. Perhaps its just a ploy to prompt the interested parties in making an offer for SKT, before they buy MW and become unbuyable. Heres hoping anyway, bought some more today. Those selling may soon regret they sold out at a low price.
I wonder whether SKT reflect on their announcement, prompted only by media speculation rather than proactively being up front with shareholders, which cost us 15% loss of market cap just this week. Something for the insider shareholders to ponder as well. Giant step backwards, pause for thought one would hope, after things were going so well.
Stick to the strategy which is working, and the return to dividends and maybe even share buybacks with FCF to increase eps, that's what people bought into. Not some fanciful off-piste acquisition or being acquired. Sadly these things can take time to recover from, time better spent staying on course. Very disappointed in SKT, they've handled this very poorly imo.
The lower SP makes a buyback more attractive. What if they can acquire MW, do a $30m buyback and resume an annual dividend of $30m I suspect that would keep everyone happy and be seen as very positive for the SP.
Best case scenario, they see sense and kill the deal.
Return $100M to shareholders via capital return/buyback and divvy.
Still leaves around $50M in the bank for smaller value-add projects like speeding up the roll out of the new STB (which is already quite late I might add). Could even explore wholesale mobile with 2D, Voda and Spark. I am sure all would want the sky business and would give competitive rates to win it.
No empire building. Just commonsense use of shareholder money.
Whilst that would seem attractive given the mess that SKT has created for itself, I still think SKT needs to have a longer period of consolidation and to keep it's powder dry for the real growth opportunities in mobile and streaming and retaining sports rights and content. Acquiring MW even at a bargain price will divert funds, focus and strategic direction into areas that ultimately I don't think will bear fruit. And any thought of a big takeover payday, which I don't think was just wishful thinking, will be gone forever.
It makes my head hurt to think how market sentiment towards the SKT and the Board has gone from being so positive to where's-my-gun? in the space of a week.