Drinks Americas Holdings, Ltd. (DKAM)

[sneaky_peaky]

***ALL SHAREHOLDERS SHOULD READ***

Now that everybody has had their frame of reference adjusted on things, I wanted to take a look at some "Kenny Clues" from the August call. You can see them if you think like he thinks and have the capacity to look forward hard enough. Forward it to your friends and neighbors and direct it to those sitting on the fence or on other boards so they can have the benefit of seeing what we see.

The important point I wanted to make is we are just chipping away at the tip of this iceberg at this point in the process. There are so many ways Kenny can go AND WILL go. I WILL interpret what I see and what he is saying. You can go in what ever direction you wish as long as you don't lose sight of the vision!

CC Highlights (Courtesy of Seeking Alpha):

In each of the calls in the past we’ve taken questions, “Well, how come you’re not here and how come you’re not there?” And we internally at Drinks like to view that as a positive. We like to say that (1)Trump vodka is in year 1 where Grey Goose was in year 4 and we think that all these distribution opportunities are evident with the growth opportunity both volume and margin that we have in front of us. This week you’ll find posted on our new website, just to continue this information flow, a list of the 100 top retail accounts that we were sold in, in metropolitan New York and 150 of the most fashionable Los Angeles restaurants that our Trump vodka is sold in. There remain national accounts and sales opportunities that we’ll continue to focus on and provide large growth opportunities. But we think that as we begin to communicate with shareholders, the sheer bulk and number of places that the products are sold, they understand what we’ve accomplished in a very short period of time.

(1)- He reiterates his plan and focus is with Trump's to outsell and be sold for more than Grey Goose ($2.3 BILLION). The accounts he is driving towards are multi year, multi million dollar recurring distributor partners.

(2)Trump Flavors will continue to expand nationally. To date we are selling all that we can produce. Glass is continuing to arrive from China, and competitively we find time and time again that the brand tastes phenomenally and just outdoes competitive flavored vodkas. In a short period of time Trump Flavors have sold more vodka than 90% of the new product vodka entries in their totality over the last two years. Today they’re sold in only 16 states and we’ll continue to expand distribution with them.

(2)- He tells you Trump flavor sales WILL increase going forward AND selling it as fast as they can make it and get it here. Only a third of the country is covered so sales in this category should triple nationally.

(3) Drinks’ two Interscope brands we’ve talked about will continue to grow the company and balance out our portfolio. Both the cognac and the sparkling vodka are high margin categories. Universal and Dre have a totally integrated plan for pushing this brand out across a number of advertising media, consumer and marketing formats. Dre is committed, the Universal marketing team of Jimmy Iovine and Steve Berman are two of the smartest and most committed executives that I’ve experienced in my career, and I think that the partnership and ownership of the brand that we share with them will be industry changing in the thrust of marketing that will go out from their side and benefit economically our side.

(3)- High margin means these two brands when introduced will take the company profitable. Plus, analysts get all "warm and fuzzy" when you talk about increasing margins. Interscope handles the cost of the marketing.

(4) Drinks will have the opportunity to report back to you in the very near future with two additional iconic brand entries, one in spirits we’re contemplating a scotch aligned with classic golf partners and one in beer with an icon on par with all our other partners. We will also have the opportunity to offer our Newman’s Own distribution network, a unique and incremental product that we are working on to increase our non-alcoholic business portfolio. These entries are exciting and they will continue to add to our business.

(4)- TWO new iconic entries. Our beer came today in Kid Rock. A golf related scotch to come at any moment. An expansion of the Newmans category. We already added Pomegranete but there is more.

(5) Internationally we are negotiating with potential distribution partners in India, China, and Europe. We are confident from our progress in other international markets that our iconic branding model works and it carries well across the borders that today’s media travels. If media travels across these borders, then so do our iconic brands and our success in our international markets have confirmed that.

(5)- New distribution deals in India, China, and Europe.

(6) Drinks Americas continues to create valuable global trademarks in the beverage category with far more efficient and targeted investment that would normally be required. As examples, Willie Nelson’s six-year-old bourbon can be found in retail outlets throughout Florida. His barbeque program is accelerating it. In that market there’s a Moose Lodge that orders multiple cases monthly. Members of the Moose Lodge sign on for their own bottles, signed and kept behind the bar. In Moscow there are a number of four star hotels that feature Trump Super Premium Vodka for the equivalent of $200 a bottle. (7)On Google as we said there are at least a million hits on our Dr. Dre product, the product that is technically yet to be introduced. We believe this is evidence that we are at a fantastic point in our future. We believe that the past quarter’s financial results confirm it. We believe that the quarter that we’re in there’s momentum continues to confirm it. We believe that coupled with the right strategic partners, prudent domestic and international expansion, continued improvement of our financial performance, the resources to move forward, the orders on hand in order to give us the resources to move forward, all this combines to make us a unique and exciting industry player and a company for the consumer of today and tomorrow. And it’s the consumer that will drive our financial success.

(6)- Now pay attention boys and girls! He tells you "we continue to create valuable global trademarks" that would normally cost any other company far more money. This is the INTELLECTUAL PROPERTY he referred to in the call last week. This is where the business plan is trasitioning from infancy to a branding identity that other companies will pay a premium to acquire. He even tells you he has already booked some large roders for this current quarter!

(7)- A million Google hits on a product not even out yet. The revenues coming in now that are not committed cash elsewhere.

(8) Right now today given those forward orders we have in the cash flow we will not be raising equity at this point in time nor do we anticipate the need to do it in the short term. One of the things that I think that we can’t communicate enough is that the power of - Trump vodka was a phenomenal introduction and there is no parallel I’m sure globally to the recognition of the Trump trademark, but (9)Dre and Universal Interscope is a media machine. When you go to a marketing meeting with them, 36 departments show up and the marketing I don’t want to say obligation, the marketing initiative falls to their side of the equation. We’re producing a phenomenal product, we’re producing access to distribution, we’ve got spectacular production. (10) A production relationship on those products give us substantial access to credit and production leeway so that I don’t need to raise or even change my credit facilities in order to go to market with those products and get them started. The resources, the robust bundle of resources that Interscope gives me I’m not going to be obligated to purchase those things. So between that and the fact that this industry operates on an expenditure formula of dollars per case, we think we’re in a good position going forward. (11) And we think that the stock has the opportunity to continue to show value and we think we’re in a good place. That’s where we are today.

(8)- Forward orders (is he holding back?). No need to raise capital.

(9)- Interscope will handle the marketing and the dollars to promote Dre's brands.

(10) Once again on the Dre deal, no need to raise money.

(11)- The stock. He knows it is undervalued.

(12) We remind people that 55% of the shares are held and continue to be held by management and founders of the company so we aren’t going anywhere. So (13) at the end of the day, our primary investors we think continue to acquire shares, so again we’re in a good place. The company today has no debt and we run our code word for lean is efficient. There are companies in the market today that are drowning on running their business differently. We run a very, very efficient business. We don’t spend on what we don’t have to. (14) We started this iconic business model recognizing that not only at the time I didn’t’ call it raising equity, I just knew there wasn’t enough money in the world to replicate the Seagram company, so we came up with models whether it’s the ingredient company that invested in the company or the privilege of bidding on the products or whether it’s our iconic partners, we built this model with the understanding that at a certain point we would get the critical mass, not have to continue to raise large sums of equity, and that it would become fulfilling. And that’s the critical tipping point we’re at right now. Never is a long time but right now that’s where we are.

(12)- 55% of the shares held by management and founders of the company. They aren't going anywhere. They aren't selling.

(13)- Kenny gets the reports on who is buying stock. He knows that the stock is being ACCUMULATED OVER THESE PAST 8 MONTHS NOT BEING SOLD BY SOMEONE WITH A LARGE POSITION.

(14)- He tells you again what I said above. The business plan has reached a point where the sales will begin to go exponential now that they have the critical mass. Critical Mass = Momentum.

(15) Right now we feel that we don’t need a big chunk of capital. If we had a big chunk of capital perhaps there’s an acquisition that you’d put it to use on. We wouldn’t put it into marketing because we just don’t think we need it at this point in time. So perhaps if we had a big chunk of capital there might be an acquisition that we could apply the iconic beverage model to. By that I mean there might be a product out there that we could, I’m being facetious but we could apply Elvis to the right product, maybe there’s something we could buy that isn’t working or would work more efficiently with our iconic beverage model. So if we had a big chunk of capital, that might be where we would put it. But I don’t want to get into speculation beyond that because we don’t have and we’re not looking for a big chunk of capital right now to do that.

(15)- Once again he tells you we don't need capital. Here he also tells you of the pending acquistion. He throws you off with the big chunk of capital thing. he even tells you they could buy a company and apply the iconic model to it. This would be the Olifant acquisition from two weeks ago.

(16) With respect to the quarter there will always be ebb and flow based on shipments in our business and one of the things that I guess we should continue to stress is that our production shipments don’t relate to our sales out of distributors which are very hard for us to report and manage, so we don’t. But we see momentum on the brand continuing. And I think I just said that we look to continue to deliver the type of percentage growth that we have in the last quarter in the foregoing quarters.

(16)- Now he also uses the word momentum. He also clues you into that momentum continuing on the quarter he posted 108% sales growth and 68% aggregate 2006-2008 growth. And he pluralizes it!

(17) Obviously I think the word used exponential is the best observation. We’ve gotten pretty good at this. The growth of Dre or the addition of Dre and the two other brands that we’ll talk about and come back and talk about, maybe even through a call, are going to be exponential. You don’t get a million Google hits and the anticipation with the European community of a product like that and not be able to deliver exponential growth. And we have the partnership of Universal delivering exponential resources. So we think that we are, and you have something also that is going on through Universal. One, you have the [inaudible] of that community of Dre and all the other albums and artists that he’s associated with and then you have eventually, and I’m not prepared to give a date for Universal, but you have eventually his tour which will also drive growth around that brand. So you have a lot happening around any of these iconic artists. Any artist that we continue to add will have his own media machine that just drives volume.

(17)- Now he transitions from momentum to exponential growth. He even tells you of "a call", a conference call coming to discuss TWO new product introductions. So, we should see another new product come out this week. He also tells you Dre will be touring and promoting his products on that Tour with Detox.

(18) The other thing that we’ve done that I should speak about, I used the word tapestry in the earnings call very deliberately. We have connected and if one were to read all the contracts deliberately, we have created a tapestry that probably is unique even in the entertainment industry in that all the different relationships that we have are connected to each other. We have a relationship with Universal where they have assisted us in the sales and marketing of Trump. Obviously the Trump organization has every interest in assisting us with the sales and marketing of our other products. We have relationships with different marketing enterprises. We have an agreement with Crush Management which is a management company that handles Brit brands, band tours, concert events and promotions. The artist wants green M&Ms in the VIP room, well that contract calls for not only Dre’s products but Trumps products and Old Whiskey River products and Newman’s products. So as we continue to branch out across these different forums and media forums, the opportunity is to put the products in each of those relationships and there’s no harm in doing that and that’s where you’re going to see some of this large exponential growth and benefit to everybody. And that I think has never been done before. Companies that manage brands whether it’s the candy company or the liquor company have independent brand managers with independent budgets and every one of those people that want to put their M&M color in the backroom of an artist has to write a check for their color M&M. What we’ve done is create a media meld of our products and our strategy around those products with all our partners and we think that’s cutting edge, it’s the way marketing will be done in years to come. All these deals that you’re seeing, these critical 360 deals with Live Nation, that’s a cookie cutter, what we’ve been out ahead of for two years. So we’re very excited about that.


(18) All the deals seem to be interconnected in some way. He is trying to convey that he has created icons who represent brands rather than companies who use events and stars to promote products. His has a much, much longer time factor for sales, growth, and patriotism to a product.

He also introduces you to two deals he is working on. Crush handles musicians in the New York area. They also handle British bands. He has already said he is expanding in Europe. He is begging to say he will be setting up and releasing branded offerings in Europe on European artists. But the biggie is Live Nation, the largest concert promoter in the world. Kenny obviously is setting up a deal with Live Nation for branding our products with them throughout the world. Live Nation is the largest producer of live music concerts in the world, annually producing over 16,000 concerts for 1,500 artists in 57 countries. The company sells over 45 million concert tickets a year and expects to drive over 60 million unique visitors to livenation.com in 2008. The two will tie in together.

http://phx.corporate-ir.net/phoenix.zhtml?c=194146&p=irol-irhome

http://en.wikipedia.org/wiki/Live_Nation

http://www.crushmm.com/

(19) We have no shortage of options. The options have never been a problem. We have historically raised money with the premiums the price that the stock traded at. Our choice at this point in time is not to raise additional equity. We have and continue to have options. We prefer to manage our way through the cash flow. Remember that we have a tremendous amount of inventory that’s tied up in glass so as we ship orders we convert orders to cash; we have no debt today in the company; and at the end of the day we have a very lean management team. And in this economic environment companies that consistently perform like ours there’s no shortage of willing investors. Were we to choose to go into the market based on the calls that I get on a frequent basis and the inclination of our largest two current investors to have reinvested, I don’t want to speak for anyone but access to cash at a premium for the stock price has never been a problem for Drinks Americas. What we want to do right now is perform and continue to go forward and grow sales. And as we grow sales and grow share price, we think that should be the focus of the company today.

(19)- The stock has always traded at a discount to what deep pockets have paid to finance the company. Once again, but now it is A CHOICE not to raise capital at this time. So much $$$ we didn't see this time shows up next time virtually TWO FOLD as so much glass was purchased in advance to get the better prices from China. He is also telling you that he is getting calls and even the current investors want to do more deals with $$$ to get more shares. He flat out tells you he will grow sales and grow share price.

Fred Schulman: (20) I think maybe a point of clarification that’s evident even in the filings. One thing you’ll note, Patrick has said several times that we’re unleveraged and that is true. Even though we have in place the credit facility with Sovereign that theoretically could go up to the $10 million level I believe, we’re not drawn down on that. It is asset based, meaning it has to be based upon the inventory and receivables. As our sales advance, and I guess Patrick has mentioned it but just to underscore it, as our sales advance availability of that cash either through proceeds of sale of product or more immediately being able to draw down on those assets as those orders are being fulfilled frees up a lot of money that we have tied up in the components of our products and increasingly too our success that we’ve been describing today is not only recognized by the spirits and beverage industry generally, it’s also recognized frankly by our producers and other let’s call it partners and associates along the way as part of this business. That being the case, we’re getting much more let’s call it street credit available to us whereas we can come up with orders that don’t necessarily have to be advanced with cash up front to buy the components of the bottles or the labels or the corks. Increasingly we can leverage our success. As that happens, the need for cash goes down and correspondingly, as our sales advance cash comes in more quickly. We very carefully looked at those projections, very carefully seeing how that’s going to go, and we’re very confident if nothing else from our debt facilities that are either now in place or that will be refined that will be able to draw down money based upon those sales and those purchase orders.

(20)- Fred tells us here they have Street Credit and for the fourth time we are told cash will be coming in more quickly. This now affirms for me as the Dre product unfolds followed by the Kid Rock beer product that we see an exponential rise in sales, cash, and what else? The biggie. Shareholder equity. The one component along with share price needed for a Nasdaq or Amex listing.

First of all let me knock down an Internet rumor. Dr. Dre is not to the best of our knowledge acquiring shares of Drinks Americas. Dre is part of our contract or our partnership with Universal, which is fully disclosed in I think a past filing. We’re in partnership with Universal which is better for me to describe to lead to the Dre partnership. (21) Our partnership with Universal is an agreement to over the next three to five years form a series of brands in which we will be 50/50 partners and for which Universal Interscope were given warrants at $1.20 something, I don’t remember off hand, to which Jimmy Iovine, Chairman of Interscope Records, commented in Vanity Fair that he looks forward to turning Drinks Americas into a billion dollar enterprise through that partnership. That partnership calls for them to then negotiate with a series of artists and from their 50%, whatever equity they provide to the artist, they provide. And that’s how Dre gets brought into the picture or any subsequent artist gets brought into the picture through the equity in Universal. That way we don’t get diluted beyond the 50% we already gave up and we can model internally with the size and scope of what they’re bringing to the party. The returns for us vastly outweigh what we’ve given up in ownership of the brand, particularly the significant multiples that these brands trade at. (22) And the point that I hope is not missed in these earnings calls, the rapid acceleration of the brands through a national and global selling perspective. I know that people are saying “It’s not in my liquor store,” that’s the good news. That gives us sales opportunities. But the fact of the matter is we’re being sold in all 50 states and now marching on to Russia, China, and India. There’s brands launched that don’t get to that status in 11 years. The average pull weight of a vodka brand I think is about 5,000 cases in two years and 9 states. So the rapidity with which we do things is what we’re glad to give that equity up to. Universal manages the artist side. That’s why sometimes these things take longer maybe than what our shareholders would like, but it’s a very defined science which we think we have a good handle on and also there’s some barrier to entry from operating in a large company environment. Yes, they have cash and they have a lot of it but it’s very hard for large companies to give up a percentage of themselves in the scheme of things. So we have a very unique business model that we think has some barriers to competition and that’s how we did the Interscope Dre deal. And Dre feels and I think is very much a partner and an owner and excited about this. He’s only doing one other deal apparently and that’s the headset deal Beats if you see the success of that deal as it’s going out there, just as an aside, I think the headsets will be exposed dramatically throughout US music outlets. So if we’re as successful as his headset launch, we’ll be very happy campers. I know that’s a longer answer than you wanted, but you really asked a question with a lot of things loaded into it.

(21)- Over the next 3-5 years he will introduce a series of brands with Interscope to which THEY fully expect WILL be worth far more than $1.20 a share AND DKAM will be a BILLION DOLLAR COMPANY per Jimmy Iovine, CEO of Interscope. Patrick won't use the "B" word but has no problem making sure his inveestors know our partners can see it as they have been privy to the business plan.

(22)- Now he tells us we're marching on to Russia, China, and India. Being that Russia is now included with two other countries where we don't have a deal, I have to believe he is coming with another deal from Russia. He also tells us our pull rate for the amount of time that has gone by is much greater than most other companies.

(23) I will also note that their warrants are at $1.20 and they’re very comfortable with where this is going. So I’m very happy with my partners at Universal. I’ve spent a lot of time relative to all the things that they have on their plate with Jimmy Iovine and Steve Berman and they’re incredibly talented people who understand that the music business is increasingly a tough place to make music, they have to plant the flag somewhere or they’ve chosen to plant the flag to make money elsewhere, Dre is a perfectionist and he is their largest resource or asset. They didn’t start small. They didn’t deal from the bottom of the deck and say “Let’s see if this works.” They brought out the Howitzer and said “We’re going to make him a partner; we’re going to devote all our resources; and we’re going to make this work.” And I think somebody asked me before if I had a large sum of money what I would do, I’d direct mail that sack to every household in America. And that’s exactly what has happened. Everybody on this call understands the impact of music in today’s culture, and some of the most powerful people in music planted a flag with Drinks Americas and said “We’re bringing out the big guy, partnering with you, and going to launch a series of brands starting with Dr. Dre who is the partner/producer/publisher of every urban music artist out there, and by the way we’re taking our warrants at $1.20 and we believe in this.” The person with the question of a large sum of money is still on the line, that’s what I’d do. I’d advertise that fact.

(23)- he tells us flat out the guys at Interscope sought out a place to make more money and sided with Drinks to achieve that goal. He is basically screaming to everybody that NOW is the time if any money is spent from here on, it should be in the advertising of how huge this deal is for both companies. And that money should be spent notifying and educating the investing public.

(24) This is what I will say. I will say that the business model of drinks we’ll see employed on an increasingly frequent basis by large Fortune 500 companies and that in large part, of that amount of marketing spending today is done because somebody has a budget in a department whose power is reinforced by that budget in that department, but not necessarily correlates to consumers and products and sales. That having been said, God bless them. There’s nothing wrong with the Coca-Cola Company or any of these big companies. Our strategy was born of the reality of not having that money and the concept when we started that we knew if we were to go raise that amount of money we would be so diluted that we might as well go get a day job back at the post office. So what we did is we designed a strategy that gave us this icon model which we started with Willie and worked out the kinks, learned with Newman’s who already had an upstanding enterprise, and soared through [inaudible] heights with Trump, and then tweaked the model a little bit with the production side, the financial side, the access to celebrity and the media model side, and the equity sharing side with Universal and two great announcements that we’ll have in the near term. We tweaked the model a little bit and we think we’re on the platform of continuing to be successful. And we’re very happy about the prospects for our continued success. We don’t use the B word here.

(24)- He once again tells everyone the plan was laid out, the plan refined, and the plan tweeked. No money needed. The machine is and will run itself now.

(25) Hopefully as we deliver increased top line with each of the quarters and the revenue that will be associated with Interscope in the I guess coming quarter, there’s nothing like revenue to get the market’s attention. So not to go back to the $500,000 quarter but that was in large part related to the inability to get glass from China and some conflagrations that we faced. Now with access to glass, we’re very comfortable that we’re going to continue to have successful quarters. Those successful quarters hopefully will get people to follow the company. The international opportunity and forming an enterprise which does business with China and India we think will begin to get people’s understanding.

And those items as well as the continued progress of Trump and the introduction of Dre and then the ones that we’ll have to talk about shortly, as well as our base portfolio while it’s small it continues to grow. And there are other brands in the industry that are not growing. So we think all those things will add up to institutional investors beginning to follow the stock. I will tell you that we are getting calls and getting interviewed by the right people, so I think it all comes together. We’ve never looked in the rearview mirror or tried to figure out what’s going to lead the shotgun. We’ve simply stuck to our strategy, executed our business plan, and we think the value will become apparent. Sooner or later we’ll get an inquiry about a brand that will reinforce the value that we think are in them and the market will take notice.

But in the interim we’re going to stick to our strategy, continue to deliver results. We think that the launch of the cognacs and the sparkling vodka will be unique. The cognac business, the inquiries we’re getting from the urban market is huge, and the sparkling vodka business, no one is in the sparkling vodka category in the format that we’re going to enter it with phenomenal flavors in a champagne format bottle, and with the marketing that Dre has crafted. And again subsequent we’ll talk about some of those things but we think we’ll be in uncharted but great territory with those two enterprises and hopefully it all falls into place.

(25)- OK,more stand up and pay attention folks! No, you better sit down.

First, this is where he tells you he is being shopped by competing companies to buy out a portion of the business. He is also getting calls and being "interviewed" for analyst coverage. When he says the value will become apparent that is his way of saying "we will receive analyst coverage, the stock price will rise, we will get listed, we will get bought out." He then tells you it is business as usual as all that comes from doing what you set out to do.

Second, and this is huge. This statement, "The international opportunity and forming an enterprise which does business with China and India we think will begin to get people’s understanding." He is telling you he is expanding on doing business like he did with Recolte where he ran into all sorts of roadblocks. He is now going into these other countries and going to start businesses there that are subsidiaries of DKAM and let them license and brand our entire product line.

He finishes here by actually tossing a stone in the pond against O2 by saying "nobody is in the sparkling vodka category in the format we're goin to enter it." Just a few ripples but a tsunami on the back end for Drinks.

(26) I don’t think this would be the right call to give that guidance. I think that not unlike some of the other beverage companies that have been in the place that we are that is in some ways as much a choice as it is a direction just because of all the initiatives that we have. We’re in brands that are very profitable but we know that profitability is on the horizon and we know that more importantly in the next quarter the launch of these two brands are going to accelerate that. So that’s as much guidance as I would give at this point in time. But between our access to the resources we need to continue and the offsetting creation of value, and we really think the value of Drinks Americas and the reason that I would tell my mother to invest in the stock is that we are creating valuable brands and those valuable brands will very shortly begin to be reflected within the stock price. If Grey Goose sells for $2,000 a case and Cabo Wabo sells for $1,700 a case, then what is $100,000 case Trump brand or what is $100,000 case Dre brand if it resides within Drinks Americas. We think when that gets reflected, that’s the value of Drinks and that’s the reason to own Drinks stock. And if anyone doubts that, then they merely have to look at the history of beverages whether it’s Malibu Rum, Chivas Regal & Crown Royal in the Seagram transaction, Grey Goose, Cabo Wabo, 42 Below Vodka recently, just all those transactions. There are no bad transactions in the spirits or beverage business. Sobe, Pepsi, I mean the progression is just always increased and the value of the brands mathematically has always increased as a case multiple. It’s better than gold. So that’s what we believe will be ultimately reflected.

(27)- He tells you profitability is just around the corner. He draws the comparison to HANS without mentioning their name. The launch of the next two brands will accelerate profitablity. He flat out tells everyone, the shareholders, that his brands will command the premiums of all the other big buyouts and he even calls to the doubters by citing the progression of case sales premiums that continue to be paid.

As for his last comment?

"So that’s what we believe will be ultimately reflected."

This is clearly where he knows once all the brands are in place on a global basis DKAM will get bought out for an EXPONENTIAL premium given its EXPONENTIAL rise in sales and EXPONENTIAL value that it offers its shareholders and the acquiring company.