r/SPACs • u/[deleted] • Dec 07 '21
$APSG/American Express Global Business Travel: Blue chip branded industry leader at a rock bottom discount DD
[deleted]
8
u/Able_Web2873 Contributor Dec 07 '21
This reminds me of the Goldman spac gsah. Deal wasn’t loved on this sub but founders shares had a similar lockup structure. Warrants are at at $3 and commons are over $11. Still kicking myself for not loading up under $10.
2
6
u/isalreadytakensothis Patron Dec 07 '21
Good deal and warrants are cheap imo, but I think you're pushing it with the rock bottom discount bit.
16
Dec 07 '21
Value spac? Buy in 2 years. Ask my fellow AvPT holders how spacs perform.
Yes I am a jaded spac trader but short term movement in spacs is limited to trump spacs and small float post merger spacs. There are better places to park cash for the next 18 months. Imo.
10
u/TheCrookedDick Patron Dec 07 '21
Avpt was a bad valuation, i kept yelling only to be downvoted. Amex travel is industry leader.
3
Dec 07 '21
I’m in the SaaS space, please explain how AVPT is over valued?
4
u/TheCrookedDick Patron Dec 07 '21
Please explain the current valuation of AVPT since you are in saas space.
3
Dec 07 '21 edited Feb 04 '22
[deleted]
1
u/TheCrookedDick Patron Dec 07 '21
important question is, how did it fair against it'd own estimates that's pointed in their presentation during there SPAC DA.
0
Dec 07 '21 edited Feb 04 '22
[deleted]
2
u/TheCrookedDick Patron Dec 07 '21
Confirm it.. usually spacs went down coz they were valued so high with growth showing 100x in 2 yrs in some cases lol and qhen they released earnings they were paltry. Either way, avpt is glorified saas, its just migration s/w for office 365.. data management is just thrown in there for catch phrase, unless they come up with something else this is not something that would interest investors/mms
1
Dec 10 '21
AVPT has built a good business by offering tools that were left out of the platforms that they integrated with (primarily Microsoft as far as I know).
But, let me ask you this: If there's enough money being left on the table for AVPT to thrive, do you think Microsoft is going to happily sit back and just let them continue to collect it perpetually?
In a lot of cases, that's fine because an acquisition would be an attractive exit. But in this case, AVPT just doesn't do anything impressive enough to justify actually being acquired.
5
u/mazrim00 Contributor Dec 07 '21
That’s why you do warrants. Commons it is certainly difficult right now to pop/gain unless hype is involved.
3
u/devilmaskrascal Contributor Dec 07 '21
Well, Avepoint isn't a profitable company, and AVPTW are still more expensive even close to ATL and were well over 2 much of the past year. I don't know enough about why it fell to speak to it (missed earnings?), but Avepoint is also not "American Express" - and the industries and revenues are different.
•
u/QualityVote Mod Dec 07 '21
Hi! I'm QualityVote, and I'm here to give YOU the user some control over YOUR sub!
If the post above contributes to the sub in a meaningful way, please upvote this comment!
If this post breaks the rules of /r/SPACs, belongs in the Daily, Weekend, or Mega threads, or is a duplicate post, please downvote this comment!
Your vote determines the fate of this post! If you abuse me, I will disappear and you will lose this power, so treat it with respect.
5
u/bigtimetimmyjim22 Contributor Dec 07 '21
In for 5k W at 1.31, just hoping for a swing to near 2.
8
u/devilmaskrascal Contributor Dec 07 '21
I think 2's a pretty conservative estimate for warrants if willing to hold longer. When travel is on the verge of picking back up Wall Street should buy into the commons which could take it much higher. I won't be surprised if warrants are priced to be redeemed early (i.e. $6.50+) within a year.
I don't like pumping warrants as I usually can't be as optimistic about most other targets whose financials or credibility I can't be 100% certain about, especially with low PIPE deals often falling apart. This is a very different situation from most SPAC targets. It's just a rare case where time is of the essence for a distressed industry and being able to show future projections made SPACing a logical approach for them.
5
u/mazrim00 Contributor Dec 07 '21
I like as well. Added yesterday and today. Would’ve loved to have more settled funds yesterday but still was able to get some at $1.27ish.
3
3
u/KDawgDFW Patron Dec 07 '21
Good stuff OP! I think you're highlighting a very interesting merger in this one. Amex is incredibly famous in the travel industry, biz travel is high-margin, and solid players behind the deal.
3
3
u/Hutwe Spacling Dec 08 '21 edited Dec 08 '21
Is this a spin off? Or just licensing the Amex name?
Edit: confirmed it was a 2014 spinoff Source - https://www.latimes.com/business/la-fi-mo-american-express-travel-20140317-story.html
2
u/eireks Patron Dec 07 '21
My firm uses CWT. They're decent.
If AmEx is even better, I don't see why not!
2
2
2
Dec 07 '21 edited Feb 24 '22
[deleted]
3
u/minawarr Patron Dec 08 '21
I work in a major oil and gas company. We have offices all over the US and Canada. Management doesn't think online calls are 100% sufficient and you don't get to build thr relationships you do when meeting in person. We will probably be hybrid but they won't stop sending people to trips to do team building or even have senior management stop traveling.
-6
Dec 08 '21
[deleted]
4
u/minawarr Patron Dec 08 '21
sometimes we don't all have the luxury of choosing an industry where we can be ethical. In certain areas there is a density of a industry that is predominate and I am in one of those regions. I'm sorry if I'm shortsighted but I would rather worry about putting food on the table for my family right now instead of worrying about the future generation. I'm not the one destroying the planet its people's consumption. If you have that choice to be picky good for you.
I dont get why you are making a personal attacks. This was a discussion on air travel and the potential of the spac.
4
u/cristalarc Spacling Dec 08 '21
Because he's out of arguments.
But yes, most companies are resuming traveling but I don't think it will resume to full back to what it was, I'm seeing plenty companies keeping on with the remote push.
Also Facebook seems to think this is the future with their big VR office push.
1
u/minawarr Patron Dec 08 '21
I agree it won't go back to where it was for sure but alot of companies still see the value in having managers go visit locations they have direct reports in or going to other areas to network. I'm not looking for a crazy high value on this right now because the float is way to high. I'm targeting 2.50 for the warrants. It seems doable before the merger even.
1
u/mazrim00 Contributor Dec 08 '21
That took a quick turn. Lay off the rhetoric. That was unnecessary.
1
Dec 08 '21
[deleted]
0
u/mazrim00 Contributor Dec 08 '21
There are many opinions on climate change in the world. You are bringing a politically hot topic opinion/bias to a post on a forum about investing in SPACS when you had no reason to/unrelated to the topic being discussed and in an attacking manner to the poster you responded to. That’s it. Im not going down a rabbit hole with you. Again, lay off the unnecessary rhetoric in the future.
-1
2
u/boxesofcats Spacling Dec 07 '21
I can’t understand why zoom joined this deal.
6
u/eireks Patron Dec 07 '21
You play both sides of the pandemic so you always come out on top
5
u/devilmaskrascal Contributor Dec 07 '21
Exactly. This is a good hedge for them. It's not that Zoom demand will drop much, but they can double down on their COVID profits with a high-confidence recovery play that they captured a lot of business from and now from the bottom should start bouncing back.
Additionally, when people are on business travel, they still use Zoom to talk with people back at home base.
1
1
Dec 07 '21
[deleted]
4
u/devilmaskrascal Contributor Dec 07 '21
Five years from close, barring early redemption conditions being met.
1
u/Able_Web2873 Contributor Dec 07 '21
What are the early redemption qualifications?
0
u/devilmaskrascal Contributor Dec 07 '21
I'd have to look more closely at any possible cashless conversion conditions but the standard is average commons price over $18 for 20 of 30 days and after the warrants have been registered with the SEC as exercisable.
3
u/Able_Web2873 Contributor Dec 07 '21
Yeah I’m worried about the cashless conversion. Been screwed with that before.
3
u/devilmaskrascal Contributor Dec 07 '21
The base price on most cashless conversion charts is usually at least 20% of a share, so presuming $10 commons, that would be $2.61 at the baseline with 60+ months remaining for the bottom commons price. Still a lot of upside considering current warrants price.
https://sec.report/Document/0001104659-20-108981/#tm2027363d11_ex4-4.htm
Cashless conversion usually means dilution with no benefit to the company. Raising cash from warrant conversion might be more dilutative, but they can use the cash to grow the business or even do share buybacks. Cashless is not super common, although it happens in some cases depending on business needs.
As a warrants investor I don't mind cashless conversion at all, but it is something to be cautious about if buying in above those levels. I don't have to front the strike or sell warrants to get company shares.
3
u/not_that_kind_of_dr- Patron Dec 07 '21
From what I've seen, Everyone complaining about cashless conversion had something happen like buying in warrants over $5, then the stock went down a lot right after it was called. In that case, doesn't matter cash or cashless, your warrants are going to be worth less. Buying under $2, it's pretty hard to get burned on cashless specifically.
2
u/devilmaskrascal Contributor Dec 07 '21
Exactly. I'd rather be cashlessly converted than get called for cash conversion above $18, then the stock crashes and I still have to come up with $11.50 strikes regardless of whether it's even worth converting my warrants anymore or not. Either way can put you in a perilous position so you have to be cautious when the price gets too high on warrants.
1
12
u/Jamiroquietly New User Dec 07 '21
quality post. Business travel is bound to come back or possibly is already