Q: Good morning Team,
How much debt do you think Converge is taking on to fund the NCIB. Is there anyway that FCF is funding this?
What are your thoughts on not seeing Maine or Bernard jump in, put their money where their mouth is and buy?
Is it time to take the 55% loss and move on?
How much debt do you think Converge is taking on to fund the NCIB. Is there anyway that FCF is funding this?
What are your thoughts on not seeing Maine or Bernard jump in, put their money where their mouth is and buy?
Is it time to take the 55% loss and move on?
5i Research Answer:
Keep in mind that the buyback is not mandatory. CTS can choose not to do anything. Free cash flow was $65M in the last 12 months, so it has some capacity. But with net debt at $320M we would like to see lower debt instead. There has been some net insider buying in the last six months, but a new committment would go a long way in helping investor confidence. We are OK holding, for now.