$100m cash in the bank!
https://i.imgur.com/lrxwFQW.gif
Jesus Christ, you and Peter are both delusional when it comes to Sky's cash generation ability! No way is it going to have that much free cash flow.
Look, here's the situation bro, Sky's problem is the amount of expenses and capital that's required to run the business!
Media companies are like SaaS companies, there's a fixed amount of cost but every additional customer that comes on board is almost 100% profit once the bills have been paid!
Operating a media company in a small country like NZ is inefficient. That's why TV3 went under, and that's also why a takeover by an American conglomerate of Sky is almost assured to happen. This is the trend globally!
The good news is that Sky has great top line revenue and no debt. This means that equity holders should be rewarded with a decent pay out should a cash offer come forward.
The reason why there's no talk of a divy or buyback right now is because Sky is weighing up all the options. There's a lot on the table. Buying Vocus is an option but it's a risky option. Becoming a full fledged telco and competing with two large established players in a small market is not a smart move. At the very least this will required further capital investment and existing shareholders will be diluted out of any potential gains. Not to mention waiting a very long time for returns.
The best way forward is to leverage Sky's own strengths, which is it's satellite customers who pay a large monthly fee for what is mainly low cost repackaged content with the odd high cost sporting event. Sky needs to consolidate with a large market capitalized company that has access to global credit at a discounted rate. It then needs to merge into the Australian market (Foxtel) and form an NZ/AUS division. That's what Discovery/Warner is doing. The Chair understands all this bro. This is what's happening behinds the scenes. Doing divys and buybacks is just wasting time here.
The bottom line, is that the DEAL IS HAPPENING THIS MONTH. AUGUST IS DEAL MONTH. AUGUST IS WHEN OSB DEAL HAPPENED. AUGUSTS IS WHEN RUGBYPASS HAPPENED. AUGUST IS DEAL MONTH. IT WOULD HAVE HAPPENED LAST AUGUST BUT COVID HIT!
I added 100k shares today. I'll be buying more every time it goes down! I will also be dumping all my stock on the 25th if there's no deal! Clock is ticking! No bull**** slide 80 talk either! Has to be legit deal or I'm out and never posting here again!!
https://timer.getmara.com/ZGF0ZT0yMD...VsPXNlYw==.gif