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Posts Tagged ‘Gerbsman Partners’

U.S. Forecasts Smaller Loss From Bailout of Banks

Posted in Board Of Intellectual Capital, tagged , , , , , , , , on December 7, 2009| Leave a Comment »

Here is an article from Dealbook at NY Times.

The Treasury Department expects to recover all but $42 billion of the $370 billion it has lent to ailing companies since the financial crisis began last year, with the portion lent to banks actually showing a slight profit, according to a new Treasury report, Jackie Calmes writes in The New York Times.

The new assessment of the $700 billion bailout program, provided by two Treasury officials on Sunday ahead of a report to Congress on Monday, is vastly improved from the Obama administration’s estimates last summer of $341 billion in potential losses from the Troubled Asset Relief Program. That figure anticipated more financial troubles requiring intervention.

The officials said the government could ultimately lose $100 billion more from the bailout program in new loans to banks, aid to troubled homeowners and credit to small businesses.

Still, the new estimates would lower the administration’s deficit forecast for this fiscal year, which began in October, to about $1.3 trillion, from $1.5 trillion.

The report could tamp down some of the public anger directed against both parties over the bailouts. Congressional leaders are already planning to use some of the program’s money for economic stimulus and job creation.

Of course, the government’s potential losses extend beyond the Treasury program. The Federal Reserve, for example, still holds a trillion-dollar portfolio of mortgage-backed securities whose market value is unknown.

The improved picture of the Treasury program is the result of higher-than-expected returns on the loans and the fact that, as the financial sector has recovered from its free fall last year, the government has not had to use much more of its $700 billion in lending authority this year, according to the Treasury officials, who declined to be identified as discussing the report before it was presented to Congress.

Last week, Bank of America became the latest big bank to say that it was raising private capital and would soon repay its $45 billion bailout loan. Once that payment is made, Citigroup will be the last big bank tethered to the state.

The estimated $42 billion in losses is a net figure that accounts for some profits to offset the losses. The Treasury officials said the government had lost about $60 billion, roughly half to Chrysler and General Motors and the other half to the insurance giant American International Group.”

Read the full article here.

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Successful termination of “Prohibitive Executory Real Estate Contract”

Posted in Board Of Intellectual Capital, boic, Distressed IP, Economy, Gerbsman Partners, Housing market, Intellectual capital, Investments, Market research, tagged , , , on December 2, 2009| Leave a Comment »

Steven R. Gerbsman, Principal of Gerbsman Partners, and Robert Tillman, member of Gerbsman Partners Board of Intellectual Capital, announced today that Gerbsman Partners successfully terminated the executory real estate contract for a financial services company. The venture capital backed company, executed a lease for space in Northern California. Due to market conditions, the company made a strategic decision to terminate its corporate space allocation. Faced with potential contingent liabilities in excess of $5 million, the company retained Gerbsman Partners to assist them in the termination of their prohibitive executory real estate contract.

About Gerbsman Partners

Gerbsman Partners focuses on maximizing enterprise value for stakeholders and shareholders in under-performing, under-capitalized and under-valued companies and their Intellectual Property. Since 2001, Gerbsman Partners has been involved in maximizing value for 60 Technology, Life Science and Medical Device companies and their Intellectual Property,, through its proprietary “Date Certain M&A Process” and has restructured/terminated over $790 million of real estate executory contracts and equipment lease/sub-debt obligations. Since inception, Gerbsman Partners has been involved in over $2.3 billion of financings, restructurings and M&A transactions.

Gerbsman Partners has offices and strategic alliances in Boston, New York, Washington, DC, Alexandria, VA, San Francisco, Europe and Israel.

For additional information please visit www.gerbsmanpartners.com

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IPO VIEW-Tech deals lead IPO recovery

Posted in Board Of Intellectual Capital, Business models, Economy, Gerbsman Partners, Investments, IPO news, Market research, Strategy, Technology, Venture Capital, tagged , , , , , , , , , , , , , , , , on December 1, 2009| Leave a Comment »

Here are some interesting stats on IPO´s from Forbes.

“More technology companies went public this year despite a world economy still trying to find its footing, and that is a good sign the pace of tech initial public offerings might accelerate in 2010.

Ten tech companies have gone public so far this year, raising $3.8 billion. In 2008, there were three offerings that raised $749.2 million, according to Thomson Reuters data.

Tech deals account for the biggest number of IPOs so far this year and are second only to finance deals in value.

‘We’ve been expecting an uptick in technology because it has really been underrepresented in the market over the last few years,’ said Paul Bard, a research analyst at Connecticut-based Renaissance Capital.

There could be 40 to 50 tech IPOs next year, raising $4 or $5 billion, Bard said.

Tech IPOs did well in 2007, but nearly shut down when financial markets collapsed last year. Getting more small, high-growth tech companies into the IPO mix would be a major engine for jobs and a boon for investors, analysts said.

‘If they’re done right, tech IPOs historically have had the greatest increase in revenues and profits of all IPOs,’ said Scott Sweet, senior managing partner at IPO Boutique.

Three technology companies filed for IPOs this week.

Netherlands-based Sensata Technologies Holding B.V. on Wednesday filed an offering worth up to $500 million. The firm, whose customers include BMW, Huawei Technologies Co Ltd and Samsung, makes sensors and other industrial technology.

Chipmaker Telegent Systems Inc filed for a deal worth as much as $250 million, and software maker RedPrairie Holding Inc said it would try to raise $172.5 million in its IPO.

‘There is an enormous amount of capital on the sidelines right now, in mutual funds and hedge funds, looking to make high-return investments as they would find in technology IPOs,’ said America’s Growth Capital Chief Executive Ben Howe.

Howe warned that investors have become more cautious and companies without strong balance sheets could meet a lukewarm response. A good idea used to be enough for a tech company to go public, he said, but the financial crisis has changed that.

Sensata, which filed for the largest IPO this week, posted revenues of $796.9 million in the nine months ended Sept. 30, down 31 percent from $1.2 billion a year ago. In the same period it narrowed its net loss to $41.6 million from $82.3 million.”

Read the full article here.

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Why I am an Optimist

Posted in Board Of Intellectual Capital, tagged , , , on November 30, 2009| Leave a Comment »

By John Mauldin

John Mauldin, Best-Selling author and recognized financial expert, is also editor of the free Thoughts From the Frontline that goes to over 1 million readers each week. For more information on John or his FREE weekly economic letter go to: http://www.frontlinethoughts.com/learnmore

I admit that of late my writings have had a rather dark tone. There are certainly a number of severe long-term problems that we must deal with, and they’re going to serve up a lot of economic pain. But the Thanksgiving weekend with the kids has me in a reflective mood, and one that has only served to underscore my long-term optimism. This week we look at why 2007 will not be the good old days we will yearn for in 20 years, after we briefly visit Dubai and the latest unemployment numbers.

Subprime Dubai

While we in the US spent our Thursday eating turkey and watching football, the rest of the world’s markets went into a downward spiral as Dubai announced it wanted its lenders to give the country a six-month moratorium on some $80-90 billion in debt. This has the potential to be the largest sovereign debt default since Argentina. Somehow this was a shocking development. (How can too much debt and real estate be a problem?) And by markets I mean gold, commodities, oil, stocks, and risk assets everywhere. They all went down. Today the US markets experienced their own sell-off, though not as deeply as the rest of the world.

As I wrote last Friday, the world is now negatively correlated with the dollar, and as money went into the dollar and US treasuries, everything else went down. Vietnam devalues, Greece is looking increasingly risky, Russia wants to devalue some more, the world is still deleveraging, etc. Is this another repeat of 1998, when Russia and the Asian debt crisis tanked the markets?

To get an answer, let’s look at some facts about Dubai. It is one of the Arab Emirates; but unlike its neighbor Abu Dhabi, oil is only about 6% of the economy. While the foundations of the country were built with oil, the country has diversified into finance, real estate, tourism, trading, and manufacturing. It is a small country, with a little under 1.5 million residents, but with less than 20% being natural citizens – the rest are expatriates.

The gross domestic product is around US $50 billion.
(Note: http://www.ameinfo.com/67802.html and then converting the currency. I found the numbers on various websites and services strangely at wide discrepancies. This seems close to a median number. I think the discrepancy is mostly people confusing the GDP for the United Arab Emirates as a whole, which includes Abu Dhabi, rather than just Dubai.)

Dubai has become a byword for thinking large. The world’s tallest building, underwater hotels, the largest manmade islands (plural), indoor snow skiing in the desert… For links to more information try this from Wikipedia: “The large-scale real estate development projects have led to the construction of some of the tallest skyscrapers and largest projects in the world, such as the Emirates Towers, the Burj Dubai, the Palm Islands and the world’s second tallest, and most expensive hotel, the Burj Al Arab.” The list goes on and on.

UBS suggests that the $80-90 billion in debt may not include rather large off- balance-sheet debt (where have we seen that one?). So, a country with a GDP of $50 billion borrows $100 billion. They build massive projects, which are now among the most expensive real estate in the world. The latest manmade island plans for one million people to buy property there. Seriously. Talk about Field of Dreams.

Then came the credit crunch. Property values dropped by as much as 50%. Sales, say the developers in understatements, have slowed. Seems there was a lot of debt used to speculate on real estate, not to mention buying Barney’s, Las Vegas casinos, banks, etc. And while US banks have little exposure, it seems England has about 50% or so of the debt, with the rest of Europe having the lion’s share of the remainder. Admittedly, the estimates seem to confuse the debt of Dubai with that of Abu Dhabi, so it is hard to know a reliable number, other than that European banks are the most exposed.

Now, here’s the deal. Abu Dhabi has the world’s largest sovereign wealth fund, at over $650 billion. Dubai has a “mere” $15 billion. If they cared to, Abu Dhabi could write a small check and make all the problems disappear. It just seems that they are not ready to do that, at least not yet. Abu Dhabi already got the world’s tallest building on past debt problems.

Construction and real estate were as much as 25% of the economy. Let’s see. Large leverage with maybe $5 billion in interest in a $50 billion economy that is 25% construction? A construction and real estate-driven economy. A real estate bubble. Sound like California, Florida, Spain? How can this be a surprise, except that everyone expected big brother Abu Dhabi to pick up the check?

While Abu Dhabi did advance $5 billion earlier, Dubai is not letting that money out of the country. There are projects to be finished, you understand. From where I sit, this is just rather hard-headed negotiations, a restructuring of who owns what and who will get what assets. It will all settle out. Given the massive losses that world banks have already taken, this is rather small potatoes.

So why the reaction by the markets? Because I think many participants know that the potential for there to be a serious correction is quite real. When anything as relatively small as Dubai spooks the market, it should serve as a warning sign. The world has priced in 5% GDP growth for the US and much of the developed world in the equity and commodity markets. Either we have to get that or the markets are going to have to come back to the reality of what I think is going to be a much lower growth figure.

But in any event, one of the lessons to be learned is that investors should pay attention to where the leverage is. Unsustainable debt trends end in tears. They always do. Spain, Greece, Italy, the UK, and Japan will all have to face major restructuring in the next decade due to leverage. And we in the US will also find that we cannot grow debt at our current levels. Will we pare our debt willingly or be forced to by the market? Either way, it will make for a less than optimal economy over the coming years. Muddle Through, indeed.

 

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IPO talk revs up for Tesla Motors

Posted in Board Of Intellectual Capital, Business models, Economy, Gerbsman Partners, Investments, IPO news, Market research, Strategy, Technology, Venture Capital, Venturebeat, tagged , , , , , , , , , , , , , , on November 24, 2009| Leave a Comment »

Sounds to me like Tesla is going public. Here is some coverage on the topic from The GreenBeat blog at WSJ Online.

“Rumors are swirling today that Tesla Motors is seriously considering an initial public offering sometime soon. The talk has been tracked to two anonymous sources, who say the six-year-old company could cash in big on the battery-powered car trend before electric and hybrid models from companies like General Motors, Mitsubishi and Nissan make it to market.

Tesla has officially denied the prediction, calling the IPO chatter “rumor and speculation.” That said, going public in 2010 would give the San Carlos, Calif. company several distinct advantages. First, it would solidify its position as the electric car player to watch. It’s already been casually anointed as the leader by industry observers and the Department of Energy, which granted it $465 million in stimulus funds in its first round of low-interest loans for advanced transportation projects. Second, it could use the sale to raise money to get its hotly anticipated Model S sedan out the door by its 2011 due date.

Tesla is one of several cleantech companies anticipated to go public as soon as next year. When A123Systems shocked the market with its blockbuster IPO in late Sepember (its share price jumped 50 percent on opening day), many analysts, including the Cleantech Group, said that the biggest public offerings in 2010 will probably come out of the green sector. In addition to Tesla, solar system maker Solyndra — which received $535 million in loan guarantees from the DOE in March — and smart grid communications provider Silver Spring Networks have also been named as likely candidates.”

Read the full article here.

GigaOm also covers this topic saying:

“Last Friday, buzz about an imminent IPO for electric car startup Tesla Motors hit the Interwebs, courtesy of two anonymous sources familiar with the plans who spoke with Reuters. As in several previous stories about its possible plans for a public offering, the company has declined to comment.

But if and when Tesla goes through with its long-discussed goal of going public, it could be the biggest and possibly the first public offering for a U.S. car company since Ford Motor’s IPO more than 50 years ago. The event will also offer a glimpse at the role IPOs will play in the nascent green car market — is the classic venture capital model (invest early and find a big exit in the form of an acquisition or an IPO) viable for this sector, or will a green-car IPO be more about feeding big capital needs and branding?

Hopes for a Google-like moneymaker in cleantech (Google took only $25 million in venture capital to make millionaires of 1,000 employees and billionaires of its two co-founders in a wildly successful IPO) have already started to fade for some in the sector. Stephan Dolezalek, managing director of VantagePoint Venture Partners, which has invested in Tesla, told Reuters in September that public offerings now serve more as “financing events” for alternative energy and other cleantech startups rather than a way for investors and founders to cash in on equity.”

Read their version here.

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