NOLs
I asked Ben Berry about using the NOLs, but he wasn't able to confirm whether they carry forward in the merger. Not his area of expertise, so I didn't fault him for that.
I would say that given the company wasn't properly dissolved, the tax attributes (ie. the NOL) may persist for TDS' usage. Some caveats about NOLs;
1. There are limitations on usage in an acquisition. Doesn't mean they don't have value, but TDS' ability to use them will be subject to annual limitations.
2. To the best of my knowledge, the NOLs apply only to US-sourced income. Probably won't be a problem given TDS' contemplated acquisitions seem to be focused on building up their US operations.
3. NOLs economic value is actually the tax rate multiplied by the gross net loss. This is typically what you see labeled as "deferred tax asset" on the balance sheet. Sometimes the deferred tax asset is written off because the probability of utilizing them is very low (ie. if you're a persistent money losing business), so you have to dig into the notes to the financial statements to find it. I would also keep in mind that federal tax rates have come down since the prior company existed, so the value of the NOLs has come down some. Still potentially very meaningful, but keep that in mind.
Not saying that I don't think the NOLs could have value, but just wanted to caution against ascribing too much value to them until we get more information.
Looking forward to checking off items on the catalyst list in the next few weeks. I have to imagine Mr. Stephenson is very anxious to get the company listed and take advantage of the "free PR" of being a public company.
