Pursuant to my last post on the oddity on the value I calculated, wanted to compare it with a different view on the cash flows.
Notably, the firm did around $336+m of OCF in 2011 with about $141m in interest expense paid. That numbers were $570m and $138m in 2010.
Capex was about $60m for both years, barring the acquisition costs of $110m in 2010.
So in the coming years, interest expense will be about $78m p.s.
So actual tangible cash profits will be about 336 + 141 = 477. say its 450m and less 78m gives approx $370m CFO p.a. less capex.. thats about $300m p.a.
Comparing with a new post recap debt load of $850m with about $200m cash means net cash is $650m. Debt will be paid off in less than 3 years.
So assuming 7 more years of $300m p.a, ok sorry maybe more conservative of $200m p.a, we get residual value of $1.4B for the equity of the firm. Taken over 28m new common shares, that works out to be close to $50 per share? This seems more reasonable versus the $2 i got previously and is well over the warrant strike of $29.25. But of cos I didnt account for time value.
Now my worry is the management tries to pull some acquisition stunt and continues his shareholder annihilation plans.
