Liberty Posted September 6, 2011 Author Share Posted September 6, 2011 Just rumors at this point, but hopefully turns out to be true: http://www.finextra.com/news/fullstory.aspx?newsitemid=22919 Link to comment Share on other sites More sharing options...
motownsf Posted September 7, 2011 Share Posted September 7, 2011 Looks like NewPage is going bk and put their Nova Scotia mill up for sale: http://www.foliomag.com/2011/paper-manufacturer-newpage-files-chapter-11 Link to comment Share on other sites More sharing options...
Liberty Posted September 7, 2011 Author Share Posted September 7, 2011 Looks like NewPage is going bk and put their Nova Scotia mill up for sale: http://www.foliomag.com/2011/paper-manufacturer-newpage-files-chapter-11 Any idea if it's the right kind of mill for DP? Link to comment Share on other sites More sharing options...
Liberty Posted September 15, 2011 Author Share Posted September 15, 2011 http://www.valueinvestorsclub.com/value2/Idea/ViewIdea/55886 Recent VIC writeup. Update: Up 11.8% right now. Guess a big fish read that writeup :) Link to comment Share on other sites More sharing options...
Liberty Posted September 16, 2011 Author Share Posted September 16, 2011 Second day in a row of pretty high buying volume and big price movements on seemingly no news... Hmm, did info about a new acquisition leak out somewhere? It could be something else or just random, but I'm thinking there's a probability that we'll see an announcement in the coming days. Just a guess though, I've been wrong a lot about this kind of stuff in the past - I do it more for sport than for any serious purpose :) Link to comment Share on other sites More sharing options...
Myth465 Posted September 16, 2011 Share Posted September 16, 2011 This sucks. I was just beginning my deep dive here. I looked at it for all of 5 seconds and didnt like the cash flow yield. I didnt realize they had 100 - 150 million in cash flow coming online for 2012.... I am hoping for a selloff but will buy under 35. Link to comment Share on other sites More sharing options...
Liberty Posted September 16, 2011 Author Share Posted September 16, 2011 This sucks. I was just beginning my deep dive here. I looked at it for all of 5 seconds and didnt like the cash flow yield. I didnt realize they had 100 - 150 million in cash flow coming online for 2012.... I am hoping for a selloff but will buy under 35. Welcome to the club! Whatever you do, do it before Thurso starts shipping because I doubt it'll stay anywhere near 30 after that catalyst finally arrives. Link to comment Share on other sites More sharing options...
Myth465 Posted September 16, 2011 Share Posted September 16, 2011 I made a bit of coin on Fibrek and have been kicking the tires on MERC, but what impressed me here was the forward sales and the lack of / low debt. We get all of the FCF with none of the multi years of deleveraging. It also gives a skilled Management team room to play... Link to comment Share on other sites More sharing options...
Liberty Posted September 16, 2011 Author Share Posted September 16, 2011 Do Fibrek and MERC make any kind of niche/specialty products? It was my impression that they were much more commodity players than FTP, though I haven't really researched them much (I took one quick look at the financials in Google finance and I knew they were not my kind of company - small margins, lots of debt...). That's one big advantage that FTP has over other companies that it too often gets lumped in with... Link to comment Share on other sites More sharing options...
Myth465 Posted September 16, 2011 Share Posted September 16, 2011 They are basically deleveraging commodity plays. I dont mind commodity and dont mind debt, but will avoid it if I can find something else thats equally as nicely priced. Link to comment Share on other sites More sharing options...
Liberty Posted September 19, 2011 Author Share Posted September 19, 2011 http://www.lenzing.com/fileadmin/template/pdf/konzern/lenzinger_berichte/ausgabe_89_2011/LB_2011_2_Haemmerle.pdf Link to comment Share on other sites More sharing options...
Liberty Posted September 22, 2011 Author Share Posted September 22, 2011 FTP on BBC: http://www.bbc.co.uk/news/business-14989019 Video shows Landqart. Very cool, very high tech. The last part shows how Chad operates: The large amount of output is thanks to the modernising efforts of Mr Wasilenkoff. "It's a multi-decade project that requires a lot of capital," he says. As a "contrarian type of investor", Mr Wasilenkoff bought the Landquart Mill at a time when the forestry industry was struggling to perform and failing to attract investors. The mill had been making thousands of different commodity products from one very small machine - so simply was not able to compete globally. Fortress streamlined production so the mill focused solely on security paper for passports and visas, as well as bank notes. It went from producing less than 1,000 tonnes of paper per year to 10,000 per year. Mr Wasilenkoff says that by investing in research and development, Landquart is able now stay ahead of its competitors. "We have the latest, the greatest and the most state-of-the-art machinery," he says. So after buying an asset at a deep value price, he went from lots of commodity products to one high-margin niche product with a moat, and from 1,000 tons/year to 10,000 tons/year capacity, all of that more efficiently because of fewer workers and better machinery. I'd say he's pulling the right levers :) Link to comment Share on other sites More sharing options...
Liberty Posted September 22, 2011 Author Share Posted September 22, 2011 This sucks. I was just beginning my deep dive here. I looked at it for all of 5 seconds and didnt like the cash flow yield. I didnt realize they had 100 - 150 million in cash flow coming online for 2012.... I am hoping for a selloff but will buy under 35. Looks like you got your wish, Myth. Down to 30 right now. Link to comment Share on other sites More sharing options...
Myth465 Posted September 22, 2011 Share Posted September 22, 2011 Yep I waited, the question is now what does one do? Link to comment Share on other sites More sharing options...
alertmeipp Posted September 23, 2011 Share Posted September 23, 2011 I haven't done any work on this. Anyone nice enough to post their thesis? Link to comment Share on other sites More sharing options...
Liberty Posted September 23, 2011 Author Share Posted September 23, 2011 I haven't done any work on this. Anyone nice enough to post their thesis? Have you read this whole thread and what's linked from it? That would be a good starting point, and should point you to many external sources. After that if you have specific questions I'll do my best to help. Or if you just want the very quickest overview, check out the writeup on the VIC, it's pretty good. Link to comment Share on other sites More sharing options...
Myth465 Posted September 23, 2011 Share Posted September 23, 2011 Yes the VIC writeup is quite good. That plus this thread, and the Value Investigator site should bring you up to date. Basically they have at least $100 million in CF (likely more) coming online in 2012 with little pricing risk. The major risk is execution and cost containment. The market isnt pricing that in or is worried about something or another. You get free call options on the turnaround of a plant which earns nothing, and also get a call option on Management buying something in this distressed market. Basically its an upgraded FBK with better product, no / low debt, and better management..... I want to buy 4% but like my cash, will be an owner just not sure when. Would be much easier at 24...... Link to comment Share on other sites More sharing options...
alertmeipp Posted September 23, 2011 Share Posted September 23, 2011 Thanks L & M. I will have a look later. >> Basically its an upgraded FBK with better product, no / low debt, and better management..... upgraded FBK.. that doesn't give me a good feeling. u can't upgrade a loser to a winner. :o Link to comment Share on other sites More sharing options...
Myth465 Posted September 23, 2011 Share Posted September 23, 2011 Thanks L & M. I will have a look later. >> Basically its an upgraded FBK with better product, no / low debt, and better management..... upgraded FBK.. that doesn't give me a good feeling. u can't upgrade a loser to a winner. :o LOL, I made a small bit of coin on FBK. Perhaps a larger fortune here..... Link to comment Share on other sites More sharing options...
Liberty Posted September 23, 2011 Author Share Posted September 23, 2011 upgraded FBK.. that doesn't give me a good feeling. u can't upgrade a loser to a winner. :o Personally, I don't even consider FBK and FTP to be in the same business, and I don't really see what they have in common other than trees, but I guess there's more than one way to look at it ;) Link to comment Share on other sites More sharing options...
lessthaniv Posted September 23, 2011 Share Posted September 23, 2011 Thanks L & M. I will have a look later. >> Basically its an upgraded FBK with better product, no / low debt, and better management..... upgraded FBK.. that doesn't give me a good feeling. u can't upgrade a loser to a winner. :o If you PM me your email address I'll pass along the investment thesis. Gone til Monday though. Link to comment Share on other sites More sharing options...
Liberty Posted September 30, 2011 Author Share Posted September 30, 2011 http://lechoabitibien.canoe.ca/webapp/sitepages/content.asp?contentid=208251&id=1645&classif=En%20manchettes This seems to say that after some delays caused by bureaucrats being on vacation, FTP is on the verge of acquiring another plant which will be converted to DP production like Thurso. Even a high ranking provincial minister says the deal is almost done. Link to comment Share on other sites More sharing options...
lessthaniv Posted September 30, 2011 Share Posted September 30, 2011 Liberty, That mill has not been operated since 2005. It employed about 425 people and had annual production capabilities of 300,000 MT of softwood kraft. Wouldn't that be something if Chad could pull off another Thurso? As it stands today, completely ignoring this article and its implications, I figure Chad has successfully taken about $15M in 2006 and turned that into a business worth close to $1B. It's even more impressive when one understand's the overall credit market conditions he worked through in the 2008/2009 period. In terms of capital allocation decisions, Chad is one of the best that I can recall. 1) The $15M decision to acquire the assets in the private market 2) The $46M IPO 3) The upgrades of paper machine & capacity 4) The unbelieveable deal he struck for the Thurso asset. Bought asset for $1.2M out of bankruptcy. Negotiates a $102M loan at around 5.5% or so from Investissement Québec. Gets another $15 million from Fonds de solidarité FTQ. 5) Uses capital to convert to DP mill and the EBITDA will now likely jump from the $30M range currently to the $160M range in 2012 All I can say is wow! The emergence of this business is one of the best that I've seen. And to think ... perhaps he can pull another Rabbit out of his hat. I wouldn't bet against him at this point. Much Respect for Chad, Disclosure: Long FTP Link to comment Share on other sites More sharing options...
Liberty Posted October 1, 2011 Author Share Posted October 1, 2011 Agreed! And he mentioned in some interview that (from memory) he'd like to do at least 2-3 other deals like Thurso, so hopefully within a few years there are 3 DP plants generating 100m+ a year (each eventually getting upgraded with cogen and a biorefinery, if it makes financial sense, for even more cashflow). Link to comment Share on other sites More sharing options...
Liberty Posted October 3, 2011 Author Share Posted October 3, 2011 Another article where the mayor of LSQ says there should be a sale announced within 'weeks'. http://www.abitibiexpress.ca/Economie/Ressources-naturelles/2011-10-03/article-2765352/%26laquo%3BCe-n%26rsquo%3Best-pas-une-%26lt%3Bem%26gt%3Bballoune%26lt%3B-em%26gt%3B!%26raquo%3B/1 Link to comment Share on other sites More sharing options...
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