Clal Finance, an Ava FX holding company (33%) recently divested 50% of their stake to an undisclosed entity for $1.915 MM which values Ava at $11.6 MM. Ava FX also paid a dividend and Clal received $2.475m out of it (meaning that $7.5 was paid in total to all shareholders) and as well as being paid back a loan of $1.4m. All this might explain why Clal sold the first block for so cheap and set such a high number for the next block.
The buyer paid $500k for a CALL option to buy the remaining Clal stake for $7.44 MM, which values Ava at $45.1 MM.
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If I’m taking all these factors into account this means that Ava was valued at around $35-45 million. Not very high for a company whose profit was $6.9 million in the first half of 2009. This is only a 5-6 multiple.
If in Q1 I reported that Ava achieved an amazing profitability of $5 million, the figure dropped by more than 60% in Q2. Clal explains that this is due to market conditions and this probably affected the lower than expected valuation.
Ava FX has taken on a number of restructuring initiatives in changing the ownership structure of the firm. They have also purged their balance sheet from various debt-laden obligations in order to generate cash-flow efficiencies. One would speculate that Ava FX is planning a potential sale and/or reorganization of their firm.