Tele Atlas N.V. to acquire GDT inc.
http://www.teleatlas.com/template_newsdetail.jsp?ctype=press…
@APL: Perhaps my comments were not quite so unfair...
@All:
As a part of this acquisition, TA received $210 million in financing from Oak-NEA in the form a preferred stock offering. $100 will be used for the GDT purchase and $30 million for existing shareholder loans. This leaves TA with $80 million to continuing funding operations.
Is this good for TA? Yes.
Is it good for us common shareholders? No!!!
With GDT’s $45 million per year revenue, this may be enough cash to fund operations until the company can stand on its own, but our ownership is now almost zero. The Oak-NEA preferred stock is convertible to 35 million shares ($210 million = Euro 175 million / Euro 5 per share). Oak-NEA were also given warrants for another 7.1 million shares.
So at conversion, Oak-NEA will get another 42 million shares which is more than the total amount issued now. For any of your long term projections, they now need to be divided by half.
Good new and good funding for TA, but this is horrible for the small investor.