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Wll I tried to buy some stock today. I managed to get 5 per cent of what I wanted . Hmmmmmmmmm don't seem to be too many sellers here just now.
Sage.
Right now digi MBB has to abide by the permit process and the various deliberations taking place. Everything has to be put in place correctly- not just an IR to shareholders out of sequence.
Sage.
To answer you I would look at the net income- that is the $75 million less wages, wood costs, operating expenses etc. I could either use a multiple of that figure ( which is EBITDA) or I could deduct interest, tax, depreciation and use a higher multiple. I have no knowledge other than whan what has been posted here but I'd guess that after deducting all the above the net net income on the Berlin project in TOTAL could be down to around $8 million a year. If I'm anywhere near right LLEG share of that might be $2.5 million Discount that for 20 years @ what....5% ...7%??? could give some idea of magnitude. These figures could be way off beam as I really am making a few guesses.
Sage.
Invetool. You should look at this in a different way in my opinion.
Berlin is essentially a stream of income to its owners. That stream of income has a present value. The granting of a permit to operate is the catalyst that creates the income stream. Whether LLEG still owns a stake in Berlin isn't really the issue. More the issue is that a permit creates a potential capital value ( the income stream discounted). Whether LLEG retains a stake in Berlin or the monetary equivalent of that stake doesn't affect the value of the company or its shares.
The granting of the permit will create the potential capital value- that is what matters.
Sage.
More like 5 weeks!
Sage
Very true. I was purely talking about how a corporate finance or CFO person would approach valuing a business- not the value a stock market operator might put on it.
Sage.
John- I honestly haven't given much thought to timing of the announcement. Perhaps he'll wait until permit approval? As regards the "how" part I'd think a full release to all shareholders and the media.
Sage.
The only ways of valuing a business are on net revenue, free cash flow or book assets- or on a combination of those metrics.
If a business had a revenue of $75 million but outgoings of $85 million it might not be worth a lot:)
MBB's rationale for selling Berlin I feel sure must be-
a. He got a price that he feels relects the potential net income over 20 years suitably discounted
and b) He believes he can re deploy the proceeds in another project that will provide a higher NET income over a quicker time scale.
I think we should focus on b.
Sage
The 75 million figure you mention would I believe have been gross revenue-
Before
Wood costs,
Wages,
Interest charges on the lease
Depreciation and amortization.
etc etc.
The NET revenue would be much much lower.
Sage.
I added 1.5 million this week.
Next week I believe could be a profitable one.
GLTA,
Sage.
As I have said before Tap my hunch is that for MBB to have sold the equity position in Berlin he must have other specific projects in mind. I would surmise that
a) They offer a superior return to Berlin. If not why make the switch?
b) The other new project(s) will have a shoter time to revenues than Berlin.
This leads me to believe that he is probably aiming to re deploy the proceeds in a project that he has already done a lot of work on. The obvious candidates are the Mass. projects.New Bedford and/or Ware. Just my guess of course.
Sage.
Well I got some stock today but not much.
Tomorrow I'll be on look out again:)
GLTA.
Sage.
What is your basis for that opinion?
Where is the calculation??
Do you not realise the posiible potential for re investment of the proceeds? ( assuming a cash sale)
Sage.
IMO it will continue to be a very successful stock.
I have been buying today.
Sage
As you say Sun time will tell.
However I suggest you need to be careful not to let your cynicism and proclaimed MO- uncovering stock scams- to get the better of you in this case.
If a company sells an asset- in this case LLEG's 37.5% interest in Berlin then those assets properly belong to the shareholders and in 99%+ of cases that is exactly what happens. In the odd case their is financial manouvering of a questionable type that deprives the shareholders of their rightful benefit. It should not be necessary for a company to tell shareholders that the benefit of an asset sale will flow to them- that is the natural presumption, in much the same way as if you buy a mutual fund you reasonably expect any increaes in value to belong to you.
I agree with you that in general corporate morals seem to have declined in recent times. All I'd say to you is don't assume every asset sale by every company is tainted with chicanery.The vast majority aren't- it is just the very few that get publicity.
Sage.
I suggest we all just let events unfold rather than engage in wild and baseless speculation.
Personally I anticipate that when we see the full picture we'll be quite happy.
Sage.
I don't have the time or inclination to join in the melee of posts going on here right now but I'll add one or two quick thoughts.
I agree with those who say that the precise path forward for LLEG is unclear right now. We await MBB's statement on that.
However the mkt cap of LLEG right now assuming 3 billion shares of issued capital fully diluted is about $6.5 million. To me that looks quite an attractive risk/reward ahead of knowing the full facts. Using the various calculations that have been posted here at different points I think it is a fair bet that the value of LLEG's stake in Berlin exceeds that- and it could exceed it by a multiple.
I also strongly suspect that assuming LLEG's role in Berlin is a much lesser one going forward ( some type of operator?)it should not be assumed that MBB will replicate that elsewhere. In other words if the 37.5% interest in Berlin has been sold for CASH then that cash will be used in an OWNERSHIP role elsewhere. The key point to grasp here I believe is how EXPENSIVE equity is right now for any project. US VC's are being extremely aggressive in their expectations and private equity is also very demanding. Europe is slightly easier but not much so. Basically obtaining money for any sort of development project in any industry is tougher than it has been for at least 25 years. My hunch is that MBB has taken the view that he prefers to own 100% of the next project and NOT dilute shareholders unnecessarily. I suspect he will focus on projects that can produce earnings and cash flow quicker than Berlin would have done - possibly with a higher ROE.
My stance is to take a calculated view and add to my 30 million holding if we see any further price weakness. I like the odds.
Sage.
Probably turb because
a. LLEG were offered a price that fully reflected the stream of income that they would have received had they retained the 37.5% shareholding.
b. Because MBB believes he can get a higher return quicker by using the proceeds in other projects.
In other words a straightforward business decision that any competent CEO would have made were he in possession of ALL the facts.
When this whole matter is revealed I believe that the simple explanation will be shown to be the correct one, and all the various conspiracy rumors that some people have been putting forwards will prove to be groundless.
Sage.
My hunch is that any decision MBB has made regarding Berlin comes down to simple criteria.
Is the Berlin project the best use of the company's capital? Can by making a sale and re deploying the cash released, the company and its shareholders achieve a higher return, with revenue and profits starting sooner?
If the answer to that is "yes" then I can see why MBB would make a disposal.
Trying to fund renewable energy projects ( or for that matter most projects) right now via external equity is VERY expensive. Investors just don't want risk. If by selling Berlin LLEG can undertake another short term revenue project without resorting to outside equity I can see the logic of the transaction.
Sage.
To state the obvious on say 3 billion shares fully diluted we have a mkt cap here of circa $5 million. On any sort of a satisfactory/good resolution of Berlin and a new definable project, that isn't assuming very much.
Sage.
And of course LLEG could receive income from the project without being an equity holder. A project management fee for example.
Sage.
Duffer- have you never heard of insider dealing? That part of the law that deals with investors buying or selling securities with the benefit of knowledge not available to the general public.
Offenders go into prison for this.
Do you not realise that as CEO Mike would most definitely be regarded as an insider?? He would clearly have full knowledge of the Berlin transaction.
Have you never heard of this????????
Sage.
I would hope that people would look at the source of the stories and draw their own conclusions on the likely veracity of them. This whole permit process is a sensitive one and Mike and his team need to be mindful of that when releasing statements. They probably have legal constraints over what they can and can't say and when they say it right now. S/holders need to understand the mechanics of the process we are involved in and give Mike the benefit of the doubt on how/when to release information.
Sage.
As you say it is amazing king how people are so easily deceived.
Clearly lies and mis information were spread yesterday by people with malicious intent and/or hidden agendas. For anyone NOT to see that is really remarkable.To consider selling stock in LLEG based on those stories is foolish in the extreme.
Sage.
Investool- I seriously think you are on totally the wrong path here . There is no evidence to support any of your statements. The explanation is probably a lot simpler.
Sage
New Co Energy is a special purpose entity set up specifically for this project. This could quite simply be nothing more than a structural re definition of the shareholders and not an arm's length disposal. If say financing had been agreed subject to permit then a special purpose entity could be formed to recognize that. The ownership of the special purpose entity is what we need to discover.
Sage.
Well reverse there are plenty of sunsets in Florida but I haven't ridden off into any of them. Nice of you to think of me though:)
I just have better things to do than come here and read pointless posts.
Sage
Good thoughts from everyone here I'm sure Sam, for your health issues.
Philip.
I agree with you lilpuppy. Tortious interference is a well defined branch of tort law and basically requires that the defendant acts in a manner to cause economic harm to plaintiff's business.
Of course the process of such a suit would bring the process of discovery to come into play- by this the plaintiff and his/her lawyer can request any and all correspondence between the defendant and relevant connected parties and can question the defendant under oath concerning his/her communications by any means with such related parties. In many cases the discovery process can be most revealing and somewhat uncomfortable for the defendant bearing mind the law concerning perjury.
Sage.
Northern.
Lots of people talk about lots of things- usually it is smoke.
Sounds like you were at the wrong keyhole.
Good luck,
Sage.
Tap- instead of worrying about that perhaps you had better buy back the stock you sold at 13 for 16----could be a smart move or you'll pay 20 perhaps?
Sage.
Maybe too much St Paddy Day celebration and then a dream the plant was already working at full speed!? LOL
Sage.
Well Brungy I have to agree with you- sort of.
There are definitely some morons about here......they just aren't MBB.
Sage.
Northern- I don't have much time today to discuss this with you at length.
However I wonder how much you know of the history of Dell? Michael Dell attended medical school - his father was a doctor- but spent more of his time building computers than attending lectures. This caused a big family conflict as his father was determined that Michael would follow him into the medical profession.In the end after much conflict Micael dropped out of medical school ( finally) and set up Dell. After much struggling the company succeeded. The problems Michael Dell and his company faced make those of Laidlaw look like a walk in the park.
Now briefly the number of shares in issue in a company is a meaningless statistic. It is like saying you drove at 60 mph. Where ? On the interstate or down a steep mountain? The stat that matters is the number of shares X the share price= the mkt cap. What the company is valued at. In the case of Dell ( say) they could announce a 50 for 1 share split today....does that make them a "bad" company because they have 50 times as many shares out?? The structure of LLEG was in place when MBB took the shell over. He has issued more shares to develop the company. That is standard procedure in small caps. My own opinion is that when he has revenues in place and the company is profitable he will do a reverse- probably timed to co incide with a move to a better market. That will be at some point in 2011 or 2012 I would guess.
I'm out for the day now,
Sage.
You are welcome to your views.
I don't honestly think you have much idea of what you are talking about but you have your viewpoint and I have mine.
GLTY
Sage.
btw the mkt cap is $3.2 million not $420,000 :)Investing 101 as you would say.
Giant??? $2400.00 . Hardly giant .LOL
Rule 144 stock imo issued a year ago at maybe half this price.
There have been several T trades at 12 in recent weeks.
I do wish you'd do some basic DD before you post these silly ideas.
Sage.
I suggest we take all these comments from observers with a pinch of salt- quotes out of context, facial gestures etc don't convey the full depth of any meeting.
Let's wait for a full report before drawing any conclusions.
Sage.
I should sell all your stock straight away then reverse- don't delay! Avoid those trip zeros. Perhaps we should all sell immediately??? Thanks for incisive analysis.
Sage.
Please clarify. I for one have no idea of what you mean.
Sage
" Inquiring minds want (and need) to know. I wonder how the relationship between Laidlaw and PJPD affects LLEG stock value as it relates to the Berlin project (if any)? Maybe we'll find out over the next 7 months."
Are you not muddling issues? The ownership of the site is one issue- the price of LLEG stock is another and entirely different.
If Walmart apply to build a store in my town why should the day to day price of WMT concern me??
Sage.