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Iconix to be acquired in “Go Private” transaction for $3.15 per share

  • Iconix Brand Group (NASDAQ:ICON) inks an agreement and plan of merger to be acquired by Iconix Acquisition Corp., an affiliate of Lancer Capital, in an all-cash transaction that values Iconix at ~$585 million, including net-debt.
  • As per the terms, Purchaser will commence

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Comments (42)

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Sell while you can
lateralgs profile picture

What do you mean by “while you can”?
Wronnay profile picture
I have this stock since 2018. I would only make a small profit with this deal but honestly?

I am sick of the losses and bad management decisions, so I will probably get the money and put it into a better opportunity...
@Wronnay a gain of $0.02 share on $3.13/sh over the next 13 days is about 20% annualised return. That's hard to beat.
@Wronnay smart!!! I wish I knew someone who thought like you! Mr. Brown😉
lateralgs profile picture

Be nice to Mr. Brown, now. He is legend. 😁
Hillandale Advisors profile picture
What a sad story:
2018: $76mm EBITDA
2019: $82mm
2020: $55mm
2021: $40-60mm??

Did they sell company to get some equity value because they couldn’t handle the debt load? Customer losses? Seems like they are selling right before EBITDA does $75-85mm in next few years. Thoughts?
Sound Investment profile picture
@Hillandale Advisors Ummm... what?

2019 grew from 2018.

2020 is COVID - worst time for brick and mortar which is much of their customer base. You can't judge them based on 2020.
2021 we know nothing about their numbers. What kind of crap shoot is that 40-60 mil? They had signed 145 mil in guaranteed minimum royalties at a 50-60% margin minimum in one year. In all likelihood, their 2021, if not, their 2022 revenue was to show SUBSTANTIAL growth. Their debt had also been reduced significantly after they sold Umbro and Starter China. This was starting to look like a very healthy profitable company with debt completely under control... Shareholders were badly betrayed at $3.15. It is at least worth 10-20 times that.
@Sound Investment I still think it’s a setup to get Ashley to buy Umbro for fair value. We have the possibility to sell shares up to 260 million even, and keep the company in tact. Doesn’t add up. At all. Deal will fall apart.
THIS is why you have to have bad agreements to try and get stuff done. These clowns are selfish and only care about money and embarrassment. www.google.com/...

Does he clear the money in time??
I think Mudrick uses his current meme stock fame to drive the price up, gets us out of the deal with Glazer, and then refis our debt and keeps us public.
lateralgs profile picture

Possible, and I really hope it pans out that way.

But what about “Lancer’s” apparent control over the shares which will result from conversion of all the Convertible Notes? If they indeed have that in-hand, they likely already control a large majority of outstanding shares.

Admittedly, that is only my preliminary understanding of the language in the Purchase Agreement, and I could be waaaay off on that…
@lateralgs there’s no way that makes sense for anyone. They’re going to pay 500 mil effectively for it all? No way. Simply doesn’t make sense. Galvin and McLain structured their deals when hired to compensate them to maximize Iconix’s share price, not get it sold. They didn’t do all this for less than 5 million a piece.
lateralgs profile picture

Well, there is a little matter of around $600-million in outstanding debt, too. Obviously the Purchaser would be assuming that debt.

Read the agreement. It specifically states, I believe, the Purchaser must have other agreements in place with the Convertible Notes holders “prior to or concurrent with” the delivery and execution of the “merger” agreement. The “merger” agreement has been inked, correct? Iconix would not have signed the agreement if the Purchaser had not met that requirement. Further, all shares resulting from conversion of any/all of those Convertible Notes are REQUIRED by the “merger” agreement to support said “merger” agreement.

As for Galvin and McClain, first, the Board voted unanimously to approve the “merger” agreement. Secondly, my guess is both Galvin and McClain will remain in their present roles when the company is taken private. My guess is, they both will get significant increases in effective compensation at some point after the company is taken private.
Read the whole thing. It’s shaking out you folks that don’t put your name on your paper. Read the whole assignment. Ride or die. We still going up up! Mudrick didn’t buy in for a 50% pop. Authentic Brands group isn’t going public for kicks.
Wow I thought this was BK material... Surprised...
lateralgs profile picture

I’m surprised they are selling this low, especially now with the world reopening and people gladly spending on things like new clothing. The company retired around a billion dollars in debt over the last 5+ years. In my opinion, they bottomed last year. Obviously, the private equity money…and the debt commitment behind the purchase…believes much the same.
" Iconix currently expects the transaction to close before the end of the third quarter of 2021." - not before Q3
lateralgs profile picture

Correct, and good catch…
Brianstankich profile picture
I just bought this last week at 2.30, based on the technical breakout. Kinda crazy but I'll take my 33% gain and run.
lateralgs profile picture

Good timing! 😁
lateralgs profile picture
Well, I’ve had worse investments. I was holding out for a LOT higher. If this goes through, it’s almost a 5x gain for us, but I had to work EXTREMELY hard over the last 6 years to make it so. I still believe the company is worth north of 5 bucks per, based on debt reduction and other factors. Recent asset sales have demonstrated very good value of some of their properties. Umbro and Starter alone are going to be worth substantially more than the tender offer indicates. Sucks…
@lateralgs don’t sell.
lateralgs profile picture

Not planning on it.
@lateralgs to get to 5 the offer only had to be increased by less than 3%, it is interesting that offer wasn’t made
kingRIG2.0 profile picture
Wow wow wow I can’t believe this Turkey didn’t go bankrupt, gotta give their management credit
iconstockkilledme profile picture
@kingVRX Death penalty
CadillacStyle03 profile picture
Congrats guys.

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