PN

PN has rejected $475M bid from EBIX. Shares halted. PN will update it’s strategic initiatives on the cc 11/14,2016.

Rob

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Thanks for the info, Rob…I’d been wondering what is going on.

Ebix (EBIX -0.8%) this summer had initially offered $9.50 per share for Patriot National (NYSE:PN), later enhancing that to a total enterprise value of $475M (which likely would have exceeded that $9.75 valuation).
The Patriot board today rejects that $475M proposal, and will continue to evaluate other more attractive offers, and any other opportunities for value creation.

PN is currently Up 21% today at 6.90 a share. I have to admit I thought a broken deal was going to cause a crash in their price with their last earnings miss. I’ve stuck with this one thru the ride and it is my 2nd largest holding, but only a bit over my average buy price now.

I see the 4 times average volume in the last 2 hours of trading as a positive sign to hold and now in hindsight, I guess the rejection of the offer means the company is confident they can be worth much more than the $475M offer (even though their market cap is only $150M). If they are right, this company still has 38% up side from here (6.90 to 9.50)

Funny timing of the announcement. I sent their investor relations an email yesterday saying it’s been 3 months with no news and asked for an update. Johan Yokay actually did reply last night with the standard we will release publicly as soon as we have more information and that they understand the comment. Next day it is announced.

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This company has been a really interesting play. I don’t usually speculate or “trade,” but I have bought and sold shares twice now at a nice profit both times.

I became intrigued again today when the share price rose after the announcement that PN had rejected the EBIX offer, and am toying with the idea of getting in again in advance of next week’s earnings release.

I would bet that the timing of this release is related to the fact that EBIX has its quarterly report tomorrow.

I have wondered if the due diligence by EBIX led to the no deal. EBIX has a market cap that is $1.8B or 12 times larger than PN.
I would think EBIX would release something if that was the case though. Maybe EBIX will hold a conference call on the earnings and clarify their side of the story.

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