Want to know how to turn $10m into $520m in less than two years? Just ask Anchorage Capital. The private equity group has pulled off one of the great heists of all time, using all the tricks in the book, to turn Dick Smith from a $10m piece of mutton into a $520m lamb. Having spent the morning poking through the accounts, we can show how they used the company's own assets to pay for the acquisition and then dressed it up for a half a billion dollar float. We also show how all of that window dressing is coming home to roost, leaving the company and its shareholders in a precarious position (VIEW LINK)
Comments
Chris Titley
Woah. I need a drink after reading that.
James Marlay
No fence sitting here...
John Tabone
WOW would have kicked themselves for not employing apt management to run that business ,rather than giving it away for a song .
Patrick Poke
Wow. I generally avoid IPOs where the current owners are cashing out, especially if it's private equity selling. This however, has blown me away. This should be a case study for finance students.
Dom
Never buy an IPO where private equity are involved. WOW disgracefully burnt shareholder value.
Wentworth Securities
Five *****'s. The next interesting exercise would be to go and take a look at the broker research early on, and see who, if any, picked up any of this...
webbmi
You won't see any (published) broker analysis like this.
Patrick Poke
Amazingly, the DSH short position is not as strong as I expected. 0.72% of issued capital is short at COB yesterday. 1.7m shares short compared to avg daily volumes of 2.85m. I guess the question is whether the money has already been made on the short side or if it's going to zero.
Wentworth Securities
Today - $60m impairment charge, no profit guidance - it is turning into a retail version of SGH.