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Originally Posted by BCI23
Guys here will be an interesting story to follow. IMN - Imation is a dead/dying data storage company that an activist group took over in the spring. As i started looking into the company, i created an alternative hypothesis as to what the activists were after. This company has $1b of NOLs, $50 - 100m in real estate, and 90m in cash. My theory was that this activist group had zero interest in the operating businesses and was strictly after the NOLs and cash. Given today's news, seems pretty clear that Clinton Group is going to use IMN as their acquisition platform to utilize the company's NOLs. The biggest risks with these NOL shell strategies is obviously busted acquisitions but also excessive shareholder dilution but IMN has a ton of cash/real estate assets that will provide the funding for this platform that should result in little if any shareholder dilution. These stories don't always end well but its definitely interesting. To see an NOL story that has worked out very well for shareholders look at ALJJ. The market is still pricing IMN as a dying data storage company, pretty clear nobody is seeing the forest through the trees here as to how this company is being transformed.
I'm seeing $290m NOLs, not $1b (page 75 of most recent 10K). Real estate is valued at $45m -- $184m original valuation, minus $139m in depreciation. True value of course depends on whether actual depreciation has happened faster or slower than accounting depreciation. The "land" portion of the property segment is only $1.2m.
That said, it's trading at 55% of tangible book value. Now that Clinton Group has installed their new CEO, could be a serious value play.