My timing in selling my position in Consciencefood has been unfortunate because a day after selling my shares the company announced that the CEO intents to take the company private: offering exiting shareholders $0.184 per share. So I guess that my concerns about the company were probably for a large part unfounded, but at the same time it also illustrates one of the bigger risks you face as a value investor. The value might have been there, but if the company can be bought at a 23.5% premium you still miss most of the upside, and everybody who didn’t buy recently gets a break-even result at best.
Obviously it’s not a done deal yet, so it will be interesting to see how this is going to unfold. It wouldn’t surprise me if shareholders are happy to be able to exit a poorly performing investment at a small premium, but at the same time the offer price is below the recent IPO price which will make it tougher sell. I’m not a shareholder anymore, but in my opinion the CEO is trying to steal the company with a low-ball offer here.
No position in Consciencefood