Monday, August 6, 2012

Knight update- Big dilution


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400m capital infusion that gives new investors 70% of the company. - http://finance.yahoo.com/news/knight-capital-says-gets-400-113548603.html
So roughly, if this company continues(gets all of its prior clients on board) to make 200m pre-tax, then only 60m is available earnings to existing holders or the current shares on price/ebidta of 5(this was the trading multiple before tuesday) would be >$3. But this ignores there are no other fines, lawsuit costs, which may require further capital infusion and dilution
NYSE temporarily removes Knight as MM for 680 secs -> http://finance.yahoo.com/news/nyse-temporarily-removes-knight-capital-120750656.html

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