Isn't VTSI more similar (especially in terms of scale) to its 3 private competitors (Laser Shot, AIS, IES) than it is to the 3 publicly trade competitors (Meggitt, Cubic, and L-3's MPRI) as identified on pp. 8-9 of VTSI's latest annual report?
If the above answer is yes, isn't VTSI at a competitive disadvantage to these private companies if VTSI has to disclose financials, and other information (status of lawsuits, debts, stock options et cetera) and their private competitors don't? Again if the answer is yes to the first question posed, how is VTSI compared to its privately held competition by potential clients? Clients obviously can't compare share price, can they?Does restructuring VTSI capital really make VTSI appear as stable as its publicly traded competitors all of which have market caps in the hundred billions of dollars? Wasn't Ferris's original company founded in 1993 private before it essentially reverse merged into GAMZ to form VTSI?
Now that Ferris has demonstrated the viability of his business model, (with contracts earning money) and its operations with a new focus since post the GAMZ merger, why couldn't Ferris (for expansion and growth plans) now try to line up a "new level" of investors (private venture capitalist) who previously wouldn't give him the time of day and who would need the capital restructuring before making any investments to take his company to the "next level"? Do you think Ferris would be on this or any exchange if he could have gotten money from VC's originally?
If I was Ferris, and didn't feel the need to repay those small shareholders who helped fund me to get my company where it now is, I'd try to take the company private, get private funding, and grow the business without having to consider the interest of shareholders or make private company info public for competitors to see. Then after the business is larger to be more competitive with it's publicly traded competition, consider doing an IPO, and get a listing on a major exchange at a much higher PPS and market cap which would then be appealing to institutional investors. In terms of just what's good for just the company (current shareholders be damned), don't you think this is probably a better business strategy short and long term resulting in Ferris having more control, making more money and the business being more competitive?
Now I'm not saying this is what is planned, but it is a possible and viable scenario. There are a number of other scenarios too, many of which are in the best interests of the company but not necessarily the best interest of current shareholders. Often companies forget who got them to where they are in terms of being positioned for future success.
I know this story first hand. A company I helped build for 10 years as a consultant and outsourced director, that went from 1 location to over 200 during that span, got the private funds to grow more quickly from a Wall Street private VC only after agreeing to shut out its prior investors. The CEO of this company wasn't happy about this, but he couldn't get the terms changed and took the money. In my 10th year of this specific relationship, that same CEO tried to arrange for my small 12 to 15 person consulting firm to merge with a larger 80 person company because he felt (and his investors agreed) that he needed a larger company backing him up to impress potential clients. I passed on being bought out because I just didn't like the other company's management and didn't think it fit the CEO's business strategy. I immediately lost about $1 mil in contracts, and then a 1/2 year later no longer had a biz relationship with the CEO's company I helped to build. I was tossed off the island so to speak. Within a year though, the CEO also no longer had the larger company working for him either because of the concerns I originally voiced when I turned down the merger opportunity.
Now I worked with this CEO for 8 years before he had the biz I helped him build. I shared holiday dinners with him and his family. He called me a friend, and then he basically screwed me as he had his prior investors because what was best for his business wasn't best for the people who helped him get his business to where it could grow to the next level.
The business world is often a dog eat dog one; It's never safe to believe simply based on faith, that's simply not how business works. You can trust, but you also have to verify.
Didn't anyone else watch "The Social Network"?
AI
