By Cynical Bear | Sunday 12 March 2017
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Just like the moment when Rooney scored THAT goal against Arsenal in 2002 as a 16-year old in off the crossbar from 25 yards, launching himself into the limelight, I gave a yelp of delight when reading the “Intention To Float” announcement issued by Ocelot Partners (OLOT) last Wednesday. Finally, the Sub-Standard Shockers XI may have found that playmaker with a bit of magical star quality that it can build a team around.
Slightly surprised that there hasn’t been more PR around this impending IPO, which is due to start trading on Monday, so I’ll try and get things started for them as it has raised an astonishing $400 million at an IPO price of $10 to invest by way of acquisitions in the European TMT sector.
Yes, that’s right, four hundred million dollars!
That’s enough to buy the rest of the squad on its own. It’s an incredible amount when one compares it to the normal amount raised by Standard List entities, usually around the million quid mark.
Of that $400 million, the founders between them have put in about $30 million – credit due here – and they are a pretty impressive bunch too. They comprise LionTree, a specialist investment bank, Andrew Barron and Martin E Franklin. Andrew Barron is a highly experienced TMT businessman and is currently Chairman of Com Hem a market-leading Swedish TMT business and has previously been COO of Virgin Media, but it is Martin E Franklin that brings the glamour and that little something special.
I guess one should be able to tell by the use of the middle initial that we are talking about the real deal here as it often does, just think of Samuel L Jackson and, er, Michael J Fox, but Franklin has a pretty impressive track record too.
He was a successful investor / acquirer of businesses throughout the 1990’s and 2000’s, the bulk of which now form part of a business known as Jarden Corporation and he has made a small fortune as a result that he has been reinvesting in what he calls “platform plays” ever since.
In fact, it is slightly remiss of me not to know more about this guy already as he is a Standard List legend already.
In 2011, he raised an astounding £900 million on the Standard List for Justice Holdings, although it only stayed on the market for a year or so as it acquired 30% of Burger King for more than a billion, which was then listed in New York.
He also raised $905 million with the IPO of Platform Acquisition Holdings (NYSE: PAH) in May 2013 which then acquired MacDermid, a specialty chemicals business, for $1.8 billion in November 2013. It subsequently renamed itself Platform Specialty Products Corp and moved to NYSE. It has continued its acquisition spree since and despite a small dip in performance in 2016 has benefitted from the Trump Bump and the share price is back above the IPO price again.
He is involved in one other vehicle in the US too, namely Nomad Foods, which like the others originally started in the UK and then moved to NYSE in early 2016 having acquired the Iglo Group, better known for its Bird’s Eye and Findus brands.
It looks like there’s a pattern at work here.
It’s obviously easier to list here on the Standard List (whudda thought??) and then move to New York once a deal has been done. That does mean that the Sub-Standard Shockers X1 may not benefit from the skills of Ocelot Partners for long but, hey, it’s more than welcome to stay for as long as it wants. With a focus on European acquisitions, perhaps it will stay a bit longer than the others.
One point to note though, as any crime fiction fan will recognise, is that there a bit of a sniff of James Patterson about this. James Patterson made his name and fortune writing the hugely successful Alex Cross detective novels and although that Cross series still continues, James Patterson rarely worries about actually writing the books these days, he merely puts his name to them and the real author has their name in much smaller font in a duller colour at the bottom of the cover.
Similarly, I’m not sure what role Martin E Franklin will actually carry out here as he is not on the Board, but he is lending his name to it and putting some money in so let’s not worry about those minor details for now.
It’s going to be fascinating to see how this big beast goes about its business. If history is anything to go by, anyone who gets in around the IPO price has a great chance of making money in the short-to-medium term.
I’m hoping that it can help some of the other players in the squad to improve their performances too while it’s here but I guess I have to accept that if one put Rooney into my local Sunday League team, there’s probably only so much it can do!
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