That is disgusting. Why can't they just leave it alone instead of trying to squeeze blood. C'mon Warren Buffet. Buy this thing and put it on strong footing.....this is very illustrative of what the Apollo business model is
Apollo, ADT's mega-IPO falls flat
By Kevin Dowd
January 19, 2018
Security specialist ADT has completed one of the priciest PE-backed IPOs in recent memory, selling 111 million shares for $14 each to raise some $1.6 billion and establish an initial market cap of about $10.6 billion.
Those numbers are big—but ADT and its backers, including Apollo Global Management, were hoping for something a bit bigger.
The company had originally planned to sell shares for between $17 and $19 each before reducing its expectations in the face of subdued public interest. Initial reports of the possible offering from last summer indicated that ADT had hoped to achieve a valuation of $15 billion. The company lost even more value during its first day of trading, as its stock closed Friday at $12.39, equating to a market cap of about $9.3 billion.
Even at that reduced price, though, Apollo brought in a 2.3x return on its initial investment, inking profits of $2.4 billion, according to The Wall Street Journal. The firm owned a 100% stake in ADT before the IPO (which was underwritten by Goldman Sachs and Morgan Stanley) and will retain a bit less than 85% of the company's stock, per an SEC filing.
It didn't take the buyout giant lock to bring the security provider back to the public markets. Apollo had owned ADT for fewer than two years, agreeing to take the business private for $6.9 billion and merge it with existing portfolio companies Protection 1 and ASG Security during February 2016. The deal was finalized three months later.
Apollo was able to transform ADT's finances during that brief period of ownership. Here's a chart comparing some of the company's key metrics for the first nine months each of 2016 and 2017:
With every action, though, comes an equal and opposite reaction. ADT's debt load has skyrocketed under private equity ownership, rising from about $1.3 billion at the end of 2015 to nearly $10.2 billion as of last September 30, according to an SEC filing.
As would be expected, much of that debt traces back to Apollo's acquisition of the business. Of the $12.1 billion in total consideration connected to the merger of ADT, Protection 1 and ASG Security, about $3.6 billion covered the assumption of existing debt, per an SEC filing. To further finance the deal, the company took on nearly $1.6 billion in first lien term loans and $3.14 billion in senior secured notes.
Surely almost anything worth being speculated upon from what little we know from the news reports has been said at least once in this thread.So after 24 days, 14 pages, and 349 Posts what have we decided?
I totally agree with you as I stated that most people here believe that that Home Week booking is guaranteed. My comment was in response to JIMinNC's emphatic comment "I don't believe the the HGVC deed provides for a non-revokable required Home Week window".I don't see how "home week booking" could legally be eliminated. To me, that is the bases of our deed and foundation of the HGVC system. I do agree that the club rules could be changed.
I agree with you and I would hope any buyer of HGVC would also agree. My concern is with the DRI Collection Trust System which allows the sale of, for instance, Hawaii Collection points based on inventory in other states with lower vacation demand.I think you are on the right track. A buyer would not purchase a valuable franchise to destroy it. Much of the HGVC value stems from reputation, Hilton name and quality of the properties. If the properties were to be folded into other DRI properties then the value declines.
There is a possible value play, though, by utilizing economies of scale. Keep HGVC as it's own class but create savings through centralizing back office operations. This would have the impact of increasing the value of the brand.
Actually there has been some movement. on August 29th Reuters reported that HGV was exploring strategic alternatives, including a possible sale after the takeover interest from Apollo.This is a very strange thread because there has been no action taken by either parties after more than 30 days.
Even after a deal is "inked" there is regulatory approval, shareholder votes.. etc... this deal would take about 6 months to close.Actually there has been some movement. on August 29th Reuters reported that HGV was exploring strategic alternatives, including a possible sale after the takeover interest from Apollo.
These deals are complicated, and as much as most of the HGV owners are looking for a quick resolution, it may take months to reach a conclusion. I know some of the deals i have been involved with at mt work have actually taken close to a year to negotiate and agree with terms.
I am no expert, but i have to think the licensing agreements and capital light model with a significant amount of HGV inventory actually owned by 3rd parties has to complicate the mix for any prospective investor.
I sort of do this...... figuratively.Is it acceptable to just put my fingers in my ears, sit in the corner and rock quietly to pretend none of this is happening? I don't think I have the energy for any more "timeshare system consolidation". It's all too much to handle with all the MVC/VSN/Hyatt consolidation speculation.
From what I read about Elliot Management, I don't think it's good for HGVC.Seeking Alpha is reporting that an activist investor has taken a position in HGV. Not many details, and i am not familar with Elliot Management to know if thats good news or bad.. Sounds like they are pushing for a sale, so they may just be s short-term trader.
I have had limited stays at Diamond Resorts, but my experience has been favorable and is similar to yours. My concern over Diamond resorts stems from 2 issues. One is I ran the number of points and associated maintenance that is needed for weeks in Hawaii versus my stays in Hawaii using HGVC and DRI cost significantly more. Two is the usage of a trust collection system that is clearly not of homogeneous locations ie. The Hawaii Collection has a number of resorts in Western Continental United States, which are clearing not in Hawaii. However, the Western Continental US resorts does provide DRI with more inventory to sell in that Collection than they have in Hawaii.For what it is worth...
I have been a Diamond member for a very long time - I purchased my week when it was Sunterra. I converted to points but did not relinquish my deed or join the trust.
I have been very happy with Diamond, and am excited and pleased with every acquisition made by Diamond. With the exception of the high pressure sales tactics, which are not unusual in the industry and preventable by saying no and standing your ground, I have found Diamond properties to be relatively high quality, well maintained and well staffed.
I have a flexible travel schedule but have found that availablilty is excellent if you are not set on a specific resort on a specific week. This is especially true in the big markets like Florida, Hawaii and Williamsburg. My daughters have used Diamond to travel the world, again without too any problems in scheduling and availablility. (Apparently the Diamond affiliated resort in Bulgaria is the best resort in the country and readily available - why my daughter wanted to go there I don't know, but she loved it.)
I understand the reservations of the members whose resorts are being acquired by DRI, but give it a chance. I am one of the ones who likes Diamond and the company is only growing the number of resorts in it's family. I will be truly excited if this goes through.
Good question. I read it as a way to set one “strategic bidder” apart from the other bids that were private equity bidders. Like it was a company — that was not just investment capitol — that might see the purchase in their strategic interest.Any speculation on what they mean by ".....strategic bidder"????
True. However there was a time when acquisitions were in vogue with large tech companies in the Silicon Valley. Now the trend is to spin off and make them smaller.It was not that long ago that they saw it in their strategic interest to spin it off. I am doubtful that is what it is.