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Fun With Acquisitions for the Value Investor

Siegler went on to request that the board consider modifying the deal, so that current shareholders who wish to stay invested in Energy Solutions, may do so, while those that want to sell for $3.75 can cash out. We'll see where that goes.

Interestingly, Energy Solutions closed yesterday's trading at about 2% above the takeover price, indicating that some investors believe that the acquisition is not a done deal. This is supported by the fact that the company is actually able to seek new offers through Feb. 6. ES Chart ES data by YCharts

In 2008, Energy Solutions was a $27 stock that had fallen all the way to $1.50 this past June. Frankly, one of the company's major issues, and perhaps, one of the reasons the board is willing to accept $3.75 is the company's debt load, which stood at $815 million at the end of the latest quarter. There's significant cash and short-term investments on the books too, $232 million, or $2.58 per share. We'll see if any other potential acquirers believe that the equity is worth more than $3.75 per share. This could get interesting. ES Cash and ST Investments Chart ES Cash and ST Investments data by YCharts

Stay tuned.

At the time of publication the author is long Energy Solutions.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Jonathan Heller, CFA, is president of KEJ Financial Advisors, his fee-only financial planning company. Jon spent 17 years at Bloomberg Financial Markets in various roles, from 1989 until 2005. He ran Bloomberg's Equity Fundamental Research Department from 1994 until 1998, when he assumed responsibility for Bloomberg's Equity Data Research Department. In 2001, he joined Bloomberg's Publishing group as senior markets editor and writer for Bloomberg Personal Finance Magazine, and an associate editor and contributor for Bloomberg Markets Magazine. In 2005, he joined SEI Investments as director of investment communications within SEI's Investment Management Unit.

Jon is also the founder of the Cheap Stocks Web site, a site dedicated to deep-value investing. He has an undergraduate degree from Grove City College and an MBA from Rider University, where he has also served on the adjunct faculty; he is also a CFA charter holder.
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