De-Risked Balance Sheet From Game Changing Asset Sale
Asset sale significant de-risks the balance sheet, injects much needed cash to $5mm equity stub and is meaningfully accretive to pro forma EBITDA
It is not often you find something like this:
A sub $5 million market cap company entered into a contract to sell a negative EBITDA business for $64 million.
The stock went up over 150% and remains undervalued with a market cap of only $13 million.
Pro forma results should improve to over $45 million of EBITDA should national advertising remain unchanged.
Additional upside as corporate costs come down.
Pro forma net debt to EBITDA leverage will decline from 7.51x to 5.26x should the transaction close.
The valuation remains in equity stub land.
If management can continue to execute, buy the debt below par and de-lever the balance sheet there is meaningful upside.
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