Ava FX is valued at $35m and then at $45m
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.
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 Obligations In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you Read this Term in order to generate cash-flow efficiencies. One would speculate that Ava FX is planning a potential sale and/or reorganization of their firm.
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.
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 Obligations In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you Read this Term in order to generate cash-flow efficiencies. One would speculate that Ava FX is planning a potential sale and/or reorganization of their firm.