Ticker
$ALJJ
Industry
Conglomerate
Type
Divestiture
Rating
Covered
Category
General
Target Price
$3.25
ALJ is a holding company run by significant shareholder (45%+ ownership) Jess Ravich. The company acts more like a merchant bank buying and selling entire companies. Formerly owned a steel producer, sold that business and invested in printing, flooring retail, and call-center / outsourcing services. In 2022, the company is on the divestiture side again.
Notes
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- Divesting part of the Faneuil business for $140m in 1H22
- Divesting all of Phoenix color for $135m in 1H22
- Already sold “Floors N More” for essentially nothing
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Financials & Valuation
FY21 Valuation — 54m shares outstanding x $2 share price = $108m market cap. Net cash after the Faneuil divestiture could be ~$40m and then another $135m from the Phoenix Color sale would be $170-175m depending on cash generation, taxes, etc.
It’s likely there is $3+ in per share cash on hand with a few small pieces of the Faneuil business remaining.
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Resources
- 2016 Best Ideas Presentation JDP Capital Management
- Asset sales 2022 — Merger proxy with pro-forma financials
Research
ALJ Regional Holdings ($ALJJ) — Initiation (1/15/22)
ALJ Regional Holdings ($ALJJ) — Merger Proxy Notes (3/20/22)