doughishere Posted April 10, 2017 Share Posted April 10, 2017 nice Link to comment Share on other sites More sharing options...
whatdadil9 Posted May 12, 2017 Author Share Posted May 12, 2017 This board has been a little quiet on the name but alot has been going on in HJ town... Clearly STRP has shown Howard's ability to structure super accretive deals with larger strategic players. I suspect IDWM will follow the same suit... There are almost no independent content companies left they all get absorbed by larger players. Spectrum and Content are both unique in that capacity as major telecoms cannot ever have enough of it -- bandwith and content to support growing audiences. IDW recently signed a pilot deal for their marquee property Locke and Key with Hulu. We believe that Hulu moves quickly on assets and are desperately trying to keep up with NFLX for original content. Given comparable budgets for other direct to series commitments for these platforms we think this show alone could be up to 100m in revs per season for both the domestic and international window. Big budget tv series are 5-6mm episode cost.(at minimum -- stuff like friends, etc. can be even more) at 10 - 13 episodes is 50 to 80 cost. Domestic window is usually 75-80 pct of budget so thats 40 -65 mm of revs. international, svod, etc. is usally 1x the domestic window if not more so that easily can get you to 100+ mm of revenues. That means 1 show could double the entire company. Traditional networks have all types of politics and internal content machines and rivalry. NFLX/HULU have none of those things and are anxious to build library value.... This is super exciting. I suspect IDW will follow a similar path as STRP in a couple years and we will also get a multi billion dollar buyout... Link to comment Share on other sites More sharing options...
eclecticvalue Posted May 12, 2017 Share Posted May 12, 2017 IDK, When Marvel was bought by Disney. Was there a bidding war for Marvel? Marvel has been around for a very long time and has recognizable IP. Not sure about IDW. Link to comment Share on other sites More sharing options...
whatdadil9 Posted May 12, 2017 Author Share Posted May 12, 2017 IDW has a better mix of IP and is constantly creating new IP. What about the TV rights to Jonathan kellermans "alex delaware" and the graphic novel rights. I think IDW has a unique model that constantly brings in new content... Link to comment Share on other sites More sharing options...
KJP Posted June 15, 2017 Share Posted June 15, 2017 The following disclosure was in footnote 11 of the quarterly report filed yesterday: "On June 6, 2017 The Company’s Board of Directors approved a private placement of $10,000,000 of the Company’s Class B Common Stock, which is expected to close in July, 2017." Was there any prior press release or disclosure about this? I assume these shares will be placed with Jonas and friends. Link to comment Share on other sites More sharing options...
Tim Eriksen Posted June 19, 2017 Share Posted June 19, 2017 The following disclosure was in footnote 11 of the quarterly report filed yesterday: "On June 6, 2017 The Company’s Board of Directors approved a private placement of $10,000,000 of the Company’s Class B Common Stock, which is expected to close in July, 2017." Was there any prior press release or disclosure about this? I assume these shares will be placed with Jonas and friends. ouch. 40% discount. Hard to call that shareholder friendly. https://finance.yahoo.com/news/idw-media-announces-placement-existing-220000916.html Link to comment Share on other sites More sharing options...
KJP Posted June 20, 2017 Share Posted June 20, 2017 The following disclosure was in footnote 11 of the quarterly report filed yesterday: "On June 6, 2017 The Company’s Board of Directors approved a private placement of $10,000,000 of the Company’s Class B Common Stock, which is expected to close in July, 2017." Was there any prior press release or disclosure about this? I assume these shares will be placed with Jonas and friends. ouch. 40% discount. Hard to call that shareholder friendly. https://finance.yahoo.com/news/idw-media-announces-placement-existing-220000916.html Unfortunately, I don't think anyone can be surprised at the terms. Link to comment Share on other sites More sharing options...
bobozou Posted June 20, 2017 Share Posted June 20, 2017 It isn't a complete surprise bc this happened a year ago: http://idwmediaholdings.com/idw-media-announces-private-placement-to-existing-stockholders/ I get that it sucks that not everyone was able to get a placement done, but in the end (if my calcs are right), it's a 6% offering at a 50% discount, which dilutes (some) shareholders by 3 percent If longs make money, the 3 won't matter. If this is a $0, it won't be bc of the 3 dilution (past 2 years, and perhaps more going forward). Not saying it doesn't suck, but it's pretty trivial in the grand scheme. Having seen plenty of shady deals from management of other potential investments, this is pretty boring. Link to comment Share on other sites More sharing options...
whatdadil9 Posted June 20, 2017 Author Share Posted June 20, 2017 Look. We all know Howard is self interested. Go back and look pre IDW (when was CTM).... The guy bought back a ton of stock below cash and then granted himself 2mm dollars worth of stock in lieu of chairman compensation for 4 years when market cap was like 8mm --> effectively like 25 pct of the company over 4-5 years -- have to check exact specifics. He did a similar thing at IDT when he came back. Bought 25 pct of the Company in and took no cash salary and all stock for 5 years like 1 or 2.00..Was a similar dynamic.... I would call it aggressive. Some would call it borderline.... What I do know is that Howard does not like to write checks and he wrote one before and hes writing another one. 40 percent discount is arbitrary. Also, Raging Capital did sign off on it. It's actually pretty beneficial to existing shareholders. Imagine the alternative, they raise a bunch of equity in a structured follow on. Insiders get diluted (perhaps) and minorities get zero chance of participating b/c not a fund, qp, no banking relationship etc. I think the 100k min rule makes alot of sense. My understanding is that rights offerings are very expensive (I have looked into doing one) and a private placement like this is alot less expensive. Downside is that you have to be accredited and the company is responsible for AML. If the AML is wrong they are on the hook. So 100k investment (basically) unless there concentrations are crazy that the person is accredited in one way or the other. Its also expensive to service that many subscriptions. In the grand scheme of things, heres what matters. They got two tv shows on. The only reason they would raise capital is to finance working capital/financing gap in TV production. Howard wouldnt write a check now if that wasnt imminent. Our understanding is that Locke and Key will be very big budget. 5,6,7mm and episode. On 10 episodes that 50-70mm... Which could ultimately result in 75mm-100mm for us, svod, intl windows and 10-15 mm of ebitda per season... pretty juicy. The flip side of that is the deficit on a season that is greenlit could be 10-15mm.. a pretty good ROIC but presents the obvious issue. The alternative is to raise debt with warrants etc. etc. Thats not attractive in my book and usually doesnt work in media companies. I would agree with the previous commenter. If this company does 30 mm of EBITDA next year its not gonna matter. ANY OF IT. Did you see the recent valuation that was done on VICE? The key to unlocking the 150 pieces of owned IP here is show we can turn it into tv shows, mobile games,etc. Locke and Key will be a game changer if all goes as planned. They own the content and could go viral beyond the TV show. Howard wouldnt be going into his own pocket if he didnt see it. One last observation. How many independent public media companies exist that internally generate content like this? NONE. Link to comment Share on other sites More sharing options...
KJP Posted June 20, 2017 Share Posted June 20, 2017 Look. We all know Howard is self interested. Go back and look pre IDW (when was CTM).... The guy bought back a ton of stock below cash and then granted himself 2mm dollars worth of stock in lieu of chairman compensation for 4 years when market cap was like 8mm --> effectively like 25 pct of the company over 4-5 years -- have to check exact specifics. He did a similar thing at IDT when he came back. Bought 25 pct of the Company in and took no cash salary and all stock for 5 years like 1 or 2.00..Was a similar dynamic.... I would call it aggressive. Some would call it borderline.... What I do know is that Howard does not like to write checks and he wrote one before and hes writing another one. 40 percent discount is arbitrary. Also, Raging Capital did sign off on it. It's actually pretty beneficial to existing shareholders. Imagine the alternative, they raise a bunch of equity in a structured follow on. Insiders get diluted (perhaps) and minorities get zero chance of participating b/c not a fund, qp, no banking relationship etc. I think the 100k min rule makes alot of sense. My understanding is that rights offerings are very expensive (I have looked into doing one) and a private placement like this is alot less expensive. Downside is that you have to be accredited and the company is responsible for AML. If the AML is wrong they are on the hook. So 100k investment (basically) unless there concentrations are crazy that the person is accredited in one way or the other. Its also expensive to service that many subscriptions. In the grand scheme of things, heres what matters. They got two tv shows on. The only reason they would raise capital is to finance working capital/financing gap in TV production. Howard wouldnt write a check now if that wasnt imminent. Our understanding is that Locke and Key will be very big budget. 5,6,7mm and episode. On 10 episodes that 50-70mm... Which could ultimately result in 75mm-100mm for us, svod, intl windows and 10-15 mm of ebitda per season... pretty juicy. The flip side of that is the deficit on a season that is greenlit could be 10-15mm.. a pretty good ROIC but presents the obvious issue. The alternative is to raise debt with warrants etc. etc. Thats not attractive in my book and usually doesnt work in media companies. I would agree with the previous commenter. If this company does 30 mm of EBITDA next year its not gonna matter. ANY OF IT. Did you see the recent valuation that was done on VICE? The key to unlocking the 150 pieces of owned IP here is show we can turn it into tv shows, mobile games,etc. Locke and Key will be a game changer if all goes as planned. They own the content and could go viral beyond the TV show. Howard wouldnt be going into his own pocket if he didnt see it. One last observation. How many independent public media companies exist that internally generate content like this? NONE. Your post is an interesting combination of good points and a few bits of nonsense thrown in. Starting with the good, in this post and others, you've correctly spelled out the case for why the company needs additional capital. Nobody here is disputing that. You're also correct that other types of fundraising can be expensive, and there are regulatory barriers to certain types of fundraising. So, at the end of the day, raising money in this fashion may be the best thing to do. That's why the main complaint is about the price being paid, not the fact that they're raising capital. (I'm also curious how much a rights offering actually costs, because I don't know.) Now on to what in my mind appears to be nonsense: "Also, Raging Capital did sign off on it." -- Of course they did. They also get to participate (and are in fact participating) on the same terms as Jonas. Why wouldn't they jump all over this? The injured parties are small investors; Raging Capital is a beneficiary. "40 percent discount is arbitrary." -- The company has been trading for around $50/share for at least the last six months. Moreover, you have repeatedly said it's undervalued at that price. So, how is calling the offering price a "40% discount" arbitrary? Or are you suggesting that any number picked for the offering price would have been arbitrary, so picking $30/share is just as good as anything else? The my bottom line view is that Jonas is stealing little bits of the company for himself at every opportunity. Minority shareholders may get rich despite that for the reasons you've explained elsewhere on this thread, but that doesn't excuse or justify Jonas's conduct. Link to comment Share on other sites More sharing options...
whatdadil9 Posted June 20, 2017 Author Share Posted June 20, 2017 I am not justifying or excusing his conduct. AT ALL. To your point, he has taken MORE than bits a pieces from minorities along the way. he took 20-25 pct of the company at CASH because he thought his services were worth that. But, what can you do about it? Dual class stock and croney board. The best you can hope for is that he does good by growing the biz and you are along for the ride. By the way, hes not screwing all minorities just those who have less than 100k. I reasoned why that number made sense in the context of the accreditation test/etc. If he wasnt giving anyone access to the financing that woudl be a diff story. Link to comment Share on other sites More sharing options...
whatdadil9 Posted June 20, 2017 Author Share Posted June 20, 2017 And to your latter point on arbitrary.... Yes. The number is absolutely arbitrary as they could pull a piece of paper out of a hat. Just like STRP. What are these pieces of IP worth if they are not generating EBITDA. Depends on who owns them? Completely arbitrary. They decided on the lowest number they could get away without attracting real ire from folks... Link to comment Share on other sites More sharing options...
KJP Posted June 20, 2017 Share Posted June 20, 2017 I agree there's not much that can be done, other than to call out Jonas's bad behavior when you see it. Link to comment Share on other sites More sharing options...
BG2008 Posted June 20, 2017 Share Posted June 20, 2017 Investing along with Jonas is an Machiavellian endeavor, let's hope the end justifies the means, which there's been a decent track record of during the last few years. It's a tragedy that the shares didn't budge and true value investors couldn't swoop in and buy more shares at say $35 or 40 per share Link to comment Share on other sites More sharing options...
bobozou Posted June 20, 2017 Share Posted June 20, 2017 BG2008 - you imply that mgt may fleece/con investors... what makes you feel that way? (genuinely curious, maybe I dont know enough of the facts) My impression is: 1) like whatdadil9 said, that mgt is pretty aggressive with taking stock ownership when things are undervalued 2) they tend to grow their wealth thru stock ownership, vs compensation 3) as a corollary, they have more-often-than-not richly rewarded shareholders (minority included) who have stuck with them 4) they are not promotional, tho maybe a bit eccentric honestly, I dont view their behavior as more self-serving, than say Singleton/Teledyne buying back stock at a discount (from other shareholders) and issuing shares at a premium (to other shareholders)... yes, it's not quite the same bc in the case of buybacks/issuances bc everybody can participate, but the practical implications are pretty similar imo again, I could be grossly misremembering the facts, or misinterpreting them... would appreciate a different view Link to comment Share on other sites More sharing options...
iambagman Posted June 21, 2017 Share Posted June 21, 2017 As I understand the offering (I am not a lawyer) you need to show proof of ownership in July. There is nothing precluding existing shareholders who are below the 2000 share requirement from purchasing additional shares to participate in the offering. If you are accredited which I think is a fine hurdle to have for cost and other reasons laid out - there is nothing preventing somebody from participating in the rights offering. Now those who do choose to participate are agreeing to lockup those shares for 1 year - this is not nothing - a lot can happen in a year. When you ask me to lock up for a year - I ask you for a discount - is $30 the right price - given the lockup and limited trading volume - does not feel outrageously low - and anybody who is accredited and thinks it is outrageously low should be purchasing shares. Howard Jonas looks out for Howard Jonas first - I think there is a large body of work to support that statement - this rights offering, to me, on balance is fine and does not fall in the egregious category. Link to comment Share on other sites More sharing options...
KJP Posted June 21, 2017 Share Posted June 21, 2017 There is nothing precluding existing shareholders who are below the 2000 share requirement from purchasing additional shares to participate in the offering. At the risk of starting an unproductive political argument on this thread, this kind of statement reminds me of the claim that everyone in the US has "access" to great medical care. It ignores a shareholder's existing wealth (or lack thereof) as something that would "preclude" exactly the actions (or "access") you suggest. A transferable rights offering would allow all existing investors to participate in some way in this offering. But I acknowledge that I don't know the costs of that type of fundraising or whether there are regulatory barriers to using it here. A fair price would also protect existing investors who cannot participate. I have seen no evidence from the company to justify the decision to price the offering at $30/share (or the pricing of the previous offering, for that matter). To the extent anyone has seen any fairness opinions or other analyses justifying the price, please share them if you are in a position to do so. Link to comment Share on other sites More sharing options...
whatdadil9 Posted July 24, 2017 Author Share Posted July 24, 2017 Shifting gears... Some interesting developments. 1. Wynonna got renewed for 3rd season. 2. Locke and Key got upgraded writer. Shows process is moving along and top of mind. 3. Another mainstream writer options book to IDW. Looks like Locke and Key + two others "ON AIR" in 2018 not out of possibility. Company has been in the 40-50 range for over a year and a half where intrinsic value and multiples in the space have been growing.... Link to comment Share on other sites More sharing options...
iambagman Posted August 7, 2017 Share Posted August 7, 2017 NETFLIX made the 1st acquisition in the history of their company, buying a COMIC BOOK company Millar World. This is from the WSJ article: Netflix said the acquisition is “a natural progression in the company’s effort to work directly with prolific and skilled creators and to acquire intellectual property and ownership of stories featuring compelling characters and timeless, interwoven fictional worlds.” IDW Media - is a prolific creator of content - and in the world of Amazon, Hulu, Netflix, HBO etc if more producers want to be vertically integrated and closer to the sources of content that would only be good. The dream is that these niche content producers become the must have property for the studios. Jonas has proven he is a seller under the right circumstances (Straight Path to Verizon) https://techcrunch.com/2017/08/07/netflixs-first-ever-acquisition-is-indie-comic-book-publisher-millarworld/ https://www.wsj.com/articles/netflix-makes-its-first-acquisition-1502115170 Link to comment Share on other sites More sharing options...
RedDaruma Posted September 27, 2017 Share Posted September 27, 2017 A transcript for an interview with IDWE President...... IDWE president David Ozer talks 'Wynonna Earp', 'Dirk Gently' and working with Netflix and Hulu https://goo.gl/QXc4uU RD Link to comment Share on other sites More sharing options...
doughishere Posted September 30, 2017 Share Posted September 30, 2017 idw using kickstarters to fund new projects now? interesting way to raise money...... Link to comment Share on other sites More sharing options...
winjitsu Posted September 30, 2017 Share Posted September 30, 2017 idw using kickstarters to fund new projects now? interesting way to raise money...... Think of kickstarter as pre-sales rather than fundraising. Great way of determining product demand before making any capital investments. Link to comment Share on other sites More sharing options...
Jurgis Posted September 30, 2017 Share Posted September 30, 2017 There are legit and pretty well-known computer game companies who do Kickstarters too. It's not a bad way to do what Winjitsu says, though company has to know how to successfully Kickstart. As with anything, there are do's and don't's. Overall IDW Entertainment for me looks mostly like a black box. Sure they renewed "Dirk Gently" and "Wynonna Earp" and starting additional series, but I don't think it's clear what will the financial results be for these. How much IDWM is spending and how much they would get from various sources (some of it way future cash flows from the library if they keep ownership). Link to comment Share on other sites More sharing options...
ScottHall Posted September 30, 2017 Share Posted September 30, 2017 idw using kickstarters to fund new projects now? interesting way to raise money...... They've done this before. I believe they did a Ninja Turtle board game this way. Link to comment Share on other sites More sharing options...
whatdadil9 Posted April 16, 2018 Author Share Posted April 16, 2018 This is big budget and NFLX taking down all global. 10 episodes. I suspect this is prob 3mm an episode domestically...domestic covers 80 pct of production cost and intl is 2x domestic... Im getting to 50-75 incremental revs from this show alone... locke and key should be bigger too... wynonna and dirk were no name networks and low budget... the shows coming up multiples the size... Link to comment Share on other sites More sharing options...
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