It's been a particularly busy several days - there are about 75 messages yet to read on SI and I don't know how many on Yahoo (any worthwhile?).
I'll post some brief comments/reflections, then I'll start posting the analyst comments from Friday (though stay tuned for updates as new models are put forth as WCII decides how to account for the WMB revenues). Later, I'll scan in and post some of the interesting meeting handout photos and details.
The meeting was very well organized - a polished class act. There were about 250 from both the buy and sell side - most every firm was represented. This was the first time (according to the PR) that the full WCII story was told to the street - this was a very necessary thing IMO.
As most know, I have been pretty consistently bullish since getting up to speed on the story/management - but this meeting seriously solidified my opinion in a way 30 minute conference presentations never have. IMO at this point forward, this company is a buy and hold - period.
Of course I will continue to watch every tick and Q report, and stand ready to move on if the story falters - but I REALLY don't see that happening. I no longer own WCII for the likelihood of a buyout as I really don't think that is in the cards. I think WCII will be a premium end-end worldwide BB telco.
The deal with WMB was a real coup, as the cost for owning fiber was what they were paying for leasing a lesser amount. Further - this is not just dark fiber - this is lit and serviced. In THIS light, $640MM is not considered an inflated price.
Also, WCII could sell all of their local loop capacity if they wanted - but this is NOT their strategy. As BR said, there were 3 or 4 companies that could have been up front on Thurs (other than WMB) but WMB gave them the best deal (presumably a combination of price/strategy and management fit) - and this is a partnership - not just an exchange of capacity. There will probably be at least one more partner, maybe two more, but not (as expressed recently) more than this.
There aren't many IXCs or ILECs that wouldn't benefit from a relationship with WCII - but IMO the most likely future partners (in order of fit) would be WCOM, FON, GTE or T (just because of it's size and in SPITE of it's culture).
Anyway - it's late so I'll follow up with more later, but will get as many research reports posted as I have the energy for tonight - and will try to catch up on thread comments tomorrow. |
