Gee, you caught me on the gas, chemical play. I am intimately aware of ATMI. They recently announced they were going to buy NowPak Technologies and had already bought Lawrence Semiconductor and ADCS (Advanced Delivery and Chemical Systems) in 1997. This is a fantastic pick for a stock and I stand corrected in my previous statement. they are a specialty chemical company that, thanks to ADCS, it tied into chemical and delivery systems for NVLS and AMAT to name just two. This is a hot company but there are some rough roads to overcome.
The 3 acquisitions were all done for stock. However dilutive it might have seemed, the end result was that the Lawrence and ADCS acquisition enhanced the ATMI bettom line making this a very good acquistion for ATMI. With that said, a great deal of stock went to the principals of ADCS and Lawrence semiconductor. The recent shares that were registered for an upcoming offering were probably close to 50-50 company vs existing stockholders. I would venture that, considering the shares in the transaction, both Monty and Steve have a large share of the existing stockholder shares being offered coming up.
My feeling (having taken ATMI on a few nice run ups in the past 7 months) is that the price of ATMI is coming down as we get to the effective date of the registration offering. Some of these shares were "traded" for their companies at low prices (high teens for ADCS when the deal was made) such that they market, MMs, or institutions may try to give ATMI a nice haircut in time for the offering.
ATMI is a good investment but I prefer to see how the market is going to treat the upcoming offering, knowing that the ADCS and Lawrence principals are looking to convert stock into "play money." the market is cruel at times and I beleive they are sharpening their razors to give these guys a close shave.
Good comeback on a Company. You nailed the #1 guy in my book, the only one I would consider, and the only one that I have a small position in. I am waiting for the haircut before revisiting.
Funny, even now, I do not have them as a gas/chemical supplier and consider them more of an equipment supplier due to a great deal of the hardware they deal with. But you are correct, they are a dedicated supplier to the industry.
One other thing. The Asian crisis has me slightly worried about what is in store for them.
Andrew |
