Comments on: Elevation Partners Planning New Fund?
[...] the fate of Elevation's first fund rests almost solely on one investment, its $460-million stake in beleaguered smartphone maker Palm (PALM). That investment is barely in the money for Elevation. It's worth about $500 million currently.
Elevation is demonstrably in for the long term: It chose not to sell late last year when the stock peaked around $18, compared to Tuesday's close of $11.65. Palm recently raised $500 million in a stock offering, so its near term is secure.
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Crash and pass?
The SEC tends to be all over you if this is done with a lot of malice. Accountants can play with numbers like crazy such that is looks like you were attempting to become profitable. With technology companies and the crazy valuations changes, it is almost child's play to do this. Is this in the plan?
RE: Crash and pass?
That price is WELL above a reasonable valuation for Palm at this time.
Note - actually the above $7-ish isn't QUITE correct. As part of the original EP deal with Palm they got REALLY SPECIAL shares. The Preferred Shares that EP has, about 55 million when converted to common shares I think, actually get to have any funds of a buyout distributed to them FIRST before the other common share stockholders up to EP's original purchase price. So if Palm gets sold for, say, half a billion dollars then EP almost gets it ALL and the run-of-the-mill shareholders (including the OTHER shares EP owns) split up the dregs. And this is the case even though EP "only" owns about 40% of PALM.
RE: Crash and pass?
RE: Crash and pass?
This is the post I made elsewhere:
RE: Crash and pass?
RE: Crash and pass?
How EP is doing with OTHER investments, of course, ain't the best.
Wait isn't Elevation Partners....
RE: Wait isn't Elevation Partners....
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Be carfeul about believing the Me-Too Media
"Forcing a sale" of Palm would require soem DUHmb company to buy Palm at an outrageous premium that would make the ACCESS PalmSource purchase seem like sheer genius.
Or would require Palm to get down in stock price to a reasonable level, MUCH below EP's average cost.
Ain't gonna happen soon.
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BTW - ya need a little editting on the article - mucho typos.