A year ago we wrote a post on Trident Microsystems, Inc. (TRID, Financial) and why we believed there was a lot of value in the company. If you are not familiar with the company, here is what you need to know:
The following is our updated analysis on what the liquidation of the company can yield given that it liquidates within 6 months from today:
Clearly, there is still some value to be unlocked by means of liquidation. We are still waiting for a brave activist investor to show up, but we are not holding our breath.
- Trident Microsystems, Inc. designs, develops, and markets integrated circuits (ICs) for digital media applications, such as digital television (DTV) and liquid crystal display television (LCD TV)
- Company has been burning cash quickly, and there is no clear long-term strategy for profitability or market share gains.
- TRID currently has huge cash reserves, and it is trading at a price that is close to the company’s net cash value (placing no value on other assets such as PPE, inventory, etc.)
- Analysis indicates that company offers more value to shareholders by selling itself or by liquidating. However, no investors/hedge funds have taken an activist position. As a result, the company continues to destroy value and burn cash.
The following is our updated analysis on what the liquidation of the company can yield given that it liquidates within 6 months from today:
Clearly, there is still some value to be unlocked by means of liquidation. We are still waiting for a brave activist investor to show up, but we are not holding our breath.
