Upon continual review and much thinking between myself and my team, here is what we believe will take place with Solta;
New loan taken out by Solta to have the needed money for severance pay a bunch of people who will be laid off (and have been laid off now) upon merger/acquisition. New loan has a poor rate because needed fast and loan intended to be paid off fast. (no interest payments will ever be made)
ZLTQ and SLTM merge, Holders of Zltq and the pub offering lock up roll into a new IPO spin off company from the 2 that are merged or Zeltiq does secondary offering to pay off Solta Loan, or new IPO raises the money immediately for new company to pay Solta loan off. Because both companies are within 15 miles of each other, transition should be easier than most.
Current Lock up designed to keep ZLTQ price at an acceptable 20 day average closing price to make Solta Merger work. Lock up rolls over into new IPO with lock up for everyone else on the inside of new company = inflated price to a degree.
Most of the current Solta BOD remains as directors of new company (sadly). They sell out their Solta shares (as we should) make bank, Mark gets 200% pay and severance + they all get new ownership in new company (similar to private equity recap) = huge DOUBLE win for them.
Solta Shareholders get between $3 and 3.20 a share and have option to sell right away into best bid or offer on ask, or roll into Zeltiq/ new company created from Solta and Zeltiq. (I won't be doing that, I will sell)
Our final thesis (for now, lol!)
Scott
lets keep this to ourselves, eh?
its not going out
hey scott what do you make of their upcoming presentation on the 3rd? Isn’t that around the same time of the 20 day period you ? Is that how companies usually present an event like this?
Yes. always biz as usual