Packer16 Posted September 22, 2015 Share Posted September 22, 2015 An interesting SPAC warrant. At this point the company has to raise $9 million to satisfy redemptions. This can come from either an offering or the seller could accept less. There is risk here as the deal could fall apart and the warrant value will be 0. As currently, envisioned if the deal is approved the warrant holder will get 50 cents plus .05 shares or can hold unto the warrants as is (convertible into .5 shares with a payment of $5.75). The seller has some hair on it as it is NSR, a firm with Raj Gupta as a former executive. Alphavulture has a nice writeup here: http://alphavulture.com/2015/08/17/make-more-than-65-with-the-roiq-warrants/#comments Not much liquidity at this point. Packer Link to comment Share on other sites More sharing options...
Hielko Posted September 22, 2015 Share Posted September 22, 2015 You're too kind to call my write-up nice. My initial analysis was crap, but when you combine it with the comments it paints a pretty complete picture :) Link to comment Share on other sites More sharing options...
Wilson-TPC Posted September 22, 2015 Share Posted September 22, 2015 You're too kind to call my write-up nice. My initial analysis was crap, but when you combine it with the comments it paints a pretty complete picture :) Vortex does a really good job in the comment thread. This is looking really interesting. Link to comment Share on other sites More sharing options...
Jurgis Posted September 23, 2015 Share Posted September 23, 2015 What kind of odds do you guys put on this going through? Assuming: $0 if it does not go through, ~$1 if it goes through. $.40 price right now. You need at least 50% chance of this going through to make statistically OK return. Link to comment Share on other sites More sharing options...
Packer16 Posted September 23, 2015 Author Share Posted September 23, 2015 The value if it goes through is $1 ($0.5 cash plus .05 shares) so the market is implying a 40% probability of success. Packer Link to comment Share on other sites More sharing options...
Jurgis Posted September 23, 2015 Share Posted September 23, 2015 The value if it goes through is $1 ($0.5 cash plus .05 shares) so the market is implying a 40% probability of success. Packer Yes, my calculations above were wrong. I'll fix them. You get OK return even if you assume 50% probability. Link to comment Share on other sites More sharing options...
Packer16 Posted September 23, 2015 Author Share Posted September 23, 2015 There is a huge incentive to get this deal done. It is estimated the sponsor will lose $4 million and time if the deal does not get done and an additional $9 million needs to be raised to fund redemptions for the deal to go through. This $9 million can be raised from others or Ascend can accept $9 million less in the trust account when the deal is done. The sponsor is multi-billion hedge fund manager (the Clinton Group) so I think the probability of either finding funds or Ascend accepting less in the trust fund is high. However, this is a binary situation so there is more risk than in other situations. Packer Link to comment Share on other sites More sharing options...
saltybit Posted September 26, 2015 Share Posted September 26, 2015 Bought some today after reading through Alpha Vulture's post and this SA article http://seekingalpha.com/article/3498096-roi-acquisition-corp-ii-warrants-offer-compelling-upside Interesting that the price is going down, despite the vote for extension. Link to comment Share on other sites More sharing options...
saltybit Posted September 29, 2015 Share Posted September 29, 2015 https://materials.proxyvote.com/Approved/74966G/20150918/NTC_259777.PDF September 25, 2015 It is a condition to closing under the Merger Agreement, however, that the amount payable to ROI’s public stockholders who have properly elected to exercise their redemption rights with respect to their ROI common stock shall not exceed $22,580,000. Due to the redemption of 3,215,528 of our shares at $10.00 per share in connection with our special meeting of stockholders held to extend the date by which we must complete a business combination from September 20, 2015 to October 26, 2015, in order to satisfy the closing condition under the Merger Agreement, we are required to consummate a private placement of common stock to fund the shortfall in cash required to complete the Business Combination, up to 1,000,000 shares at $10.00 per share. If the closing condition cannot be satisfied as a result of such private placement or because of the redemption of more than 42,472 shares by public stockholders in connection with the vote to approve the Business Combination, then Ascend Holdings will not be required to consummate the Business Combination, although it may, in its sole discretion, choose to waive this condition. As of the date of this notice, we have not entered into a definitive agreement with respect to such private placement, and no assurance can be made that we will be able to consummate a private placement in accordance with the terms of the Merger Agreement or at all. Link to comment Share on other sites More sharing options...
Gamecock-YT Posted October 3, 2015 Share Posted October 3, 2015 http://www.sec.gov/Archives/edgar/data/1581607/000114420415057926/v421385_defm14a.htm From the proxy: Q: What are the procedures for exchanging my public warrants? A: Continental Stock Transfer & Trust Company, or the warrant agent, has been appointed by ROI to receive elections by ROI public warrantholders to have their warrants survive the closing of the Business Combination and become exercisable for Ascend Holdings ordinary shares in accordance with the terms of the warrant agreement, as amended, or exchange their warrants for cash and ordinary shares, or an election. If a public warrantholder wishes to have their warrants survive the Business Combination, such public warrantholder must vote in favor of the Warrant Amendment Proposal and make an election to have their warrants survive by marking the appropriate space on the proxy card. Such warrantholder must also provide physical or electronic delivery of such warrantholder’s public warrant certificates or warrants, as appropriate, as described below, prior to or at the special meeting of public warrantholders. Public warrantholders wishing to receive cash and ordinary shares in exchange for their public warrants must make the election by marking the appropriate space on the proxy card, but need not provide physical or electronic delivery of such warrantholder’s public warrant certificates or warrants, as appropriate, as described below, prior to or at the special meeting of public warrantholders. In order to validly make an election, a holder of ROI units must first separate its ROI units into the component common stock and public warrant in order to validly tender its public warrants to the warrant agent. If the Warrant Amendment Proposal is approved and the Business Combination is consummated, any warrantholder who votes against the approval of the Warrant Amendment Proposal or who does not elect to have their warrants survive will receive in exchange for each of its public warrants $0.50 in cash, 0.05 of an ordinary share of Ascend Holdings and cash in lieu of fractional shares. As such, only those warrantholders who vote for the warrant amendment proposal and correctly follow the procedures for making an election will be able to have their warrants survive the Business Combination. Any public warrant holder may at any time prior to the date and time of the special meeting of public warrantholders, or the election date, change such holder’s election if the warrant agent receives (i) prior to the election date written notice of such change accompanied by a new, properly completed proxy card or (ii) at the special meeting of public warrantholders a new, properly completed proxy card. ROI will have the right in its sole discretion to permit changes in elections after the election date. Public warrantholders making an election to have their warrants survive the Business Combination and become exercisable for Ascend Holdings ordinary shares in accordance with the terms of the warrant agreement, as amended, must, prior to the special meeting of public warrantholders, tender their public warrant certificates to the warrant agent or deliver their public warrants to the warrant agent electronically using the Depository Trust Company’s Automated Tender Offer Program (ATOP). Once you tender your public warrants to the warrant agent, you may not transfer your public warrants until the Business Combination is completed, unless you properly revoke your election. Link to comment Share on other sites More sharing options...
gurpaul88 Posted October 5, 2015 Share Posted October 5, 2015 Seems to be falling off a cliff, I wondering if there is a real problem of raising the required amount to get this done, or just a market reaction. Link to comment Share on other sites More sharing options...
Packer16 Posted October 5, 2015 Author Share Posted October 5, 2015 I think it is tough to tell with only about an average of only $15k dollar volume over the past 5 days. There are over 12.5 million of these warrants outstanding or about $3.8 million at price of $0.30. Packer Link to comment Share on other sites More sharing options...
Jurgis Posted October 5, 2015 Share Posted October 5, 2015 Some people may regard this as an option with time value: the longer the deal is not announced (before Oct 26) the lower time value. Not sure it's a good way to look, but could be one way... Link to comment Share on other sites More sharing options...
Packer16 Posted October 5, 2015 Author Share Posted October 5, 2015 The deal has been announced and the proxy statement has been posted (last Friday). The only uncertainty is whether a private placement will be done or whether Ascend will accept a lower amount in the trust account versus the original deal. Packer Link to comment Share on other sites More sharing options...
Jurgis Posted October 5, 2015 Share Posted October 5, 2015 The deal has been announced and the proxy statement has been posted (last Friday). The only uncertainty is whether a private placement will be done or whether Ascend will accept a lower amount in the trust account versus the original deal. Packer Right, that's what I meant "a private placement will be done or whether Ascend will accept a lower amount in the trust account versus the original deal". Sorry for shorthand "deal" that was not clear. Link to comment Share on other sites More sharing options...
valcont Posted October 6, 2015 Share Posted October 6, 2015 Hi guys, Just joined the board although I have been trolling for quite some time. I have a question about the warrant exercise. The amendment proposal states: (1) The Warrant Amendment Proposal — to consider and vote upon an amendment to the warrant agreement governing all of ROI’s warrants that provides that, upon consummation of the transactions contemplated by the Agreement and Plan of Merger, dated July 23, 2015 and amended on August 19, 2015, by and among Ascend Telecom Infrastructure Private Limited, a private limited company organized under the laws of India (“Ascend India”), Ascend Telecom Holdings Limited, an exempted company incorporated with limited liability under the laws of the Cayman Islands (“Ascend Holdings”), ROI, and NSR-PE Mauritius LLC, a Mauritius private company limited by shares (as may be amended, the “Merger Agreement”), warrantholders who vote in favor of the Warrant Amendment Proposal and follow the procedures set forth in the proxy statement/prospectus relating to the Business Combination (as defined below) will have the option to either (i) have their warrants survive the closing of the Business Combination and become exercisable for Ascend Holdings ordinary shares in accordance with the terms of the warrant agreement, as amended, or (ii) have their warrants exchanged at the closing for $1.00 per warrant, comprised of $0.50 in cash, 0.05 of an ordinary share of Ascend Holdings and cash in lieu of fractional shares, and that if the Warrant Amendment Proposal is approved and the Business Combination is consummated, any warrantholder who votes against the approval of the Warrant Amendment Proposal or who does not elect to have their warrants survive will receive in exchange for each of its public warrants $0.50 in cash, 0.05 ordinary shares of Ascend Holdings and cash in lieu of fractional shares Only holders of record of ROI’s public warrants at the close of business on September 18, 2015 are entitled to notice of the special meeting of public warrantholders and to vote at the special meeting of public warrantholders and any adjournments or postponements of the special meeting of public warrantholders. So if I buy the warrant today, do I have no right to choose my exercise option (take $.50 in cash and .005 share vs Ascend shares)? Sorry if there is an obvious answer. Warrants are not my forte. Link to comment Share on other sites More sharing options...
Guest Schwab711 Posted October 6, 2015 Share Posted October 6, 2015 Some people may regard this as an option with time value: the longer the deal is not announced (before Oct 26) the lower time value. Not sure it's a good way to look, but could be one way... I was thinking this too Link to comment Share on other sites More sharing options...
bobp Posted October 6, 2015 Share Posted October 6, 2015 No. You can choose the package of .05 shares plus 50 cents, or hold on to the warrant with terms of 2 warrants + 11.50 buys 1 common. You could argue that the warrant is worth close to the package. A price of a dollar for the 5 year warrant wouldn't be so outrageous with the stock trading at 10. Maybe that's a little high, but it's close. And in my opinion, the price of the warrant is just reflecting the perceived odds of the deal getting done. So if I buy the warrant today, do I have no right to choose my exercise option (take $.50 in cash and .005 share vs Ascend shares)? Sorry if there is an obvious answer. Warrants are not my forte. Link to comment Share on other sites More sharing options...
valcont Posted October 7, 2015 Share Posted October 7, 2015 Thanks. I agree price is just reflecting the odds of a deal. It doesn't help that the NSR was joined at the hip with Galleon and Rajat Gupta. Link to comment Share on other sites More sharing options...
Gamecock-YT Posted October 12, 2015 Share Posted October 12, 2015 NEW YORK, Oct. 12, 2015 /PRNewswire/ --ROI Acquisition Corp. II ("ROI") (NASDAQ: ROIQ; ROIQW; ROIQU) and Ascend Telecom Holdings Limited ("Ascend Holdings") today announced that they have agreed to amend the merger agreement (the "Merger Agreement") relating to the business combination among ROI, Ascend Holdings and Ascend Telecom Infrastructure Private Limited, an independent owner and provider of passive telecommunications infrastructure on a shared, multi-tenancy basis for wireless telecommunications operators in India ("Ascend India"). Ascend India is currently majority-owned by subsidiaries of funds managed by New Silk Route Advisors, LP ("NSR"). The special meeting of stockholders of ROI to approve the business combination will be held on October 23, 2015, at 9:00 a.m. Key Terms of the Proposed Amendment to the Merger Agreement: The pro forma enterprise value of Ascend India is reduced from approximately $335 million at $10 per share to $308 million at $10 per share. As a result, the number of ordinary shares of Ascend Holdings NSR will beneficially own at closing is reduced from 12.7 million to 11.2 million, excluding earnout shares. ROI's sponsors will forfeit approximately 1.1 million ROI founder shares. As a result, the number of ordinary shares of Ascend Holdings ROI's sponsors will beneficially own upon completion of the business combination is reduced from 2.3 million to 1.2 million, excluding earnout shares. Ascend Holdings may not repay the outstanding subordinated debt of an amount, as of March 31, 2015, equal to approximately INR 1,800 million (or approximately $28.89 million using an exchange rate of 1US$ = INR62.31, as of March 31, 2015) owed by Ascend India to IL&FS Financial Services Limited, an affiliate of Infrastructure Leasing and Financial Services Limited ("IL&FS"). The minimum cash amount which ROI is required to have to complete the transaction is reduced from approximately $103 million to approximately $71 million. Implied Valuation Highlights: At a pro forma enterprise value of $308 million, at $10 per share, the implied multiples are 10.8x projected fiscal 2016 EBITDA (ending March 31, 2016) and 8.9x projected fiscal 2017 EBITDA (ending March 31, 2017). Ascend Holdings' comparable companies in India trade at 13.9x projected fiscal 2016 EBITDA (ending March 31, 2016) and 12.2x projected fiscal 2017 EBITDA (ending March 31, 2017). Ascend Holdings' comparable companies in the U.S. trade at 18.8x projected calendar 2015 EBITDA and 17.3x projected calendar 2016 EBITDA. Commenting on the transaction, Joseph A. De Perio, Vice Chairman at ROI, stated, "The parties to the Merger Agreement have worked to respond to the recent volatility in the equity markets of emerging economies. We believe the updated transaction presents a significant opportunity for an equity holder to partner with an outstanding management team in a high-growth sector with an attractive business model. At a deal price of 8.9x forward EBITDA, we believe shareholders have the ability to generate significant equity returns from the compounding of 20%+ annual EBITDA growth and improvement in equity valuation multiples going forward." Parag Saxena, the Managing General Partner of NSR, stated, "We are committed to closing this transaction and providing Ascend Holdings access to U.S. capital markets as it embarks on its next phase of growth in order to meet the increasing demand for mobile voice, data and information in India. Obviously, our confidence and expectation of future returns is evidenced by our firm's 100% rollover of our equity." The proposed amendment remains subject to execution of an amendment to the merger agreement, the approval of such amendment by the board of directors of ROI, the approval by the committee of directors of IL&FS with respect to the treatment of the debt owed to its affiliate, and the merger agreement, as amended, is subject to the vote of ROI's stockholders at its upcoming special meeting, none of which can be assured. ROI will file a Current Report on Form 8-K with the U.S. Securities and Exchange Commission (the "SEC") describing the terms of the amendment, when executed, and including the amendment as an exhibit thereto. ROI intends to file and deliver to its stockholders a supplement to the definitive proxy statement/prospectus previously mailed to ROI's stockholders, which will describe the terms and impact of the amendment to the merger agreement. Sounds like they got a deal. Link to comment Share on other sites More sharing options...
Gamecock-YT Posted October 12, 2015 Share Posted October 12, 2015 So has anyone got in touch with their broker regarding having the warrants survive? I just got off the phone with Scottrade and they are working with DTCC regarding the process of having the warrants survive. The person the broker called at their reorganization desk said that they are aware of the situation but confused on how to go forward. So you guys might want to reach out to get the ball rolling if you want to keep the warrants. Link to comment Share on other sites More sharing options...
Jurgis Posted October 12, 2015 Share Posted October 12, 2015 So has anyone got in touch with their broker regarding having the warrants survive? I just got off the phone with Scottrade and they are working with DTCC regarding the process of having the warrants survive. The person the broker called at their reorganization desk said that they are aware of the situation but confused on how to go forward. So you guys might want to reach out to get the ball rolling if you want to keep the warrants. What's the benefit to keeping the warrants? Edit: I am aware that if you keep them, they are convertible into shares as per thread 1st post (convertible into .5 shares with a payment of $5.75). So if you keep them, you are levered investing in the shares at that point. Is that what you consider the benefit or is there more? Link to comment Share on other sites More sharing options...
Hielko Posted October 12, 2015 Share Posted October 12, 2015 So has anyone got in touch with their broker regarding having the warrants survive? I just got off the phone with Scottrade and they are working with DTCC regarding the process of having the warrants survive. The person the broker called at their reorganization desk said that they are aware of the situation but confused on how to go forward. So you guys might want to reach out to get the ball rolling if you want to keep the warrants. At IB your warrants will survive unless you tender them for cash+shares. Link to comment Share on other sites More sharing options...
Packer16 Posted October 12, 2015 Author Share Posted October 12, 2015 I believe the default is to receive 50 cents plus .05 shares so you need to elect with your broker to have your warrants stay as warrants. Packer Link to comment Share on other sites More sharing options...
usdtor05 Posted October 12, 2015 Share Posted October 12, 2015 So has anyone got in touch with their broker regarding having the warrants survive? I just got off the phone with Scottrade and they are working with DTCC regarding the process of having the warrants survive. The person the broker called at their reorganization desk said that they are aware of the situation but confused on how to go forward. So you guys might want to reach out to get the ball rolling if you want to keep the warrants. At IB your warrants will survive unless you tender them for cash+shares. Congrats on this one...with this mod what odds would you say of a deal getting done..interesting the warrants are still only 47cents or so. Link to comment Share on other sites More sharing options...
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