Rick
Premium,MVM
join:2001-02-06
Waterbury, CT
clubs: 
| They shelve the deal because
they get offered 200 million less than they want?
Out of a 3 Billion dollar transaction?
For lack of a better word folks..Greed..is not always good.
Perhaps they're not very much in tune with what has happened in the credit markets, but I dare say that what has happened will shape the course of borrowing and lending for perhaps a decade or more.
There are a LOT of problems yet to be uncovered IMHO.
Problems which are much deeper into the prime market than anyone ever expected.
While funding will always be there, it's now tightened up so much, and these credit markets simply will not be put in a position of funding transactions that are overly expensive anymore.
And, I think that anyone could tell you that the cable industry, and the prices that these assets have been going for, have certainly bordered on outrageously expensive.
But today with this announcement, you see the result of a group..namely the carlyle group..refusing apparently to accept that eventuality. And even accept what is a VERY modest decrease to their asking price.
IMHO..this is NO different than the homeowner who will put their house on the market for X amount of dollars..then turn away the offers for 10 grand less. Insisting instead that someone will come along and give them what they want.
I daresay that they'll find out how bad things really can get..when someday..they're selling at a 50% discount to what they once could have had.
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TKJunkMail
Enjoy the sun
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join:2002-03-03
Avalon, NJ
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| Maybe the Carlyle Group figures they can make more money RUNNING the business instead of selling it if they can't get a price at or higher than what they are asking for. At some point, when buyers dry up(based on more realistic credit rules as you say), it makes more sense to just hold on to the business instead of selling it. So, not selling may not be the mistake that you suggest.
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Rick
Premium,MVM
join:2001-02-06
Waterbury, CT
clubs:
| I hear what you're saying but I doubt that a 200 million difference in a 3 billion dollar transaction would really make it fall into that category.
That's not to say it isn't a good business to run. Just that if a seller is motivated to sell something for 3 billion, and someone offers them 200 million less..that strikes me as somewhat foolish to walk from an offer like that for that kind of a difference. ESPECIALLY..if their goal is to hold out for the market to now improve.
They might be waiting a VERY long time the way things are going. And should realize that already, cable assets were quite inflated the last few years.
Anyways..as a former Insight customer myself..I was always very happy with their service.
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The Coyote captured the RR! Roadrunner Rick is now Comcastic! |
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satellite68
join:2007-04-11
Louisville, KY
| quote:
Anyways..as a former Insight customer myself..I was always very happy with their service
As a current Insight customer, I am very happy with their service, at home, and at work at all the locations I serve. Wonder who's going to take over those accounts when the company does sell? Comcast? Time Warner?? |
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Rick
Premium,MVM
join:2001-02-06
Waterbury, CT
clubs:
| said by satellite68  : quote:
Anyways..as a former Insight customer myself..I was always very happy with their service
As a current Insight customer, I am very happy with their service, at home, and at work at all the locations I serve. Wonder who's going to take over those accounts when the company does sell? Comcast? Time Warner?? I'd suspect it will be Time Warner. Comcast already took the 1/2 that made the most sense for them.
That is, if it ever even happens now. Cable assets soared the last few years, and if carlyle is now refusing to even recognize this modest pullback and is waiting for them to go back up, they seriously might have a 20 year wait ahead of them.
IMO, this is just like someone living in a house in California that has seen it rise to a million bucks the last few years..it pulls back a bit to maybe 950 thousand..and they refuse to sell, hoping it gets back to the million dollar level.
It might very well instead go back to 700 thousand while they wait it out.
The credit markets are a disaster, and thats where interested companies turn to get financing.
That isn't going to be solved anytime soon.
They are also apparently forgetting that the telco's are now getting aggressive in moving into the tv and broadband industry. That will further devalue the cable co's IMO.
200 Million out of 3 billion is NOTHING compared to what they could lose in not taking this IMO.
If they want to sell..they should take the money..and RUN.
Or, risk selling it at a much lower price down the road.
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The Coyote captured the RR! Roadrunner Rick is now Comcastic! |
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AJICQ499087
join:2001-12-01
Louisville, KY
| Time Warner Cable Inc likely figured in the offer made to Insight the tax penalties Time Warner would have to pay by buying Insight before March of 2008. See »www.multichannel.com/article/CA6454823.html
Further, the financial markets are tougher and another possible factor in the bid is Time Warner has been having a full plate of trouble dealing with the takeover of Adelphia.
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GoodDog
join:2000-07-03
Goshen, NY | reply to Rick
What may explain this move by Insight is the company that bid $200mil less then the asking price had dubious financing and TWC bid far less then the asking price. |
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CylonRed
Premium,MVM
join:2000-07-06
Bloom County
| reply to Rick
said by Rick :IMHO..this is NO different than the homeowner who will put their house on the market for X amount of dollars..then turn away the offers for 10 grand less. Insisting instead that someone will come along and give them what they want. I daresay that they'll find out how bad things really can get..when someday..they're selling at a 50% discount to what they once could have had. So the homeowner/business owner should not have the ability to decide for themselves???? I don't get it - they know the risks - everyone does and yet they choose to take the risk. The risk is theirs. If they come across information that would benefit from waiting - why should they not wait at ANY price or will it be up to other people who will decide for everyone how much they can accept or not accept? |
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