External reports (aggregated public sources), Value Investors Club

Value Investors Club (VIC)

External reports (aggregated public sources)

Value Investors Club

Equity Bottom-Up

<ul><li>Turtle Beach is a leading manufacturer of gaming headphones experiencing strong activist involvement from the Donerail Group led by William Wyatt</li><li>Donerail's offers to acquire the company were rejected, leading to a proxy battle and control of the board</li><li>Donerail has implemented operational improvements, reducing costs and expanding margins, positioning Turtle Beach for a potential sale at a premium with strong upside potential</li></ul><p><em>This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.</em></p>

Turtle Beach is a leading manufacturer of gaming headphones experiencing strong activist involvement from the Donerail Group led by William WyattDonerail's offers to acquire the company were rejected, leading to a proxy battle and control of the boardDonerail has implemented operational improvements, reducing costs and expanding margins, positioning Turtle Beach for a potential sale at a premium with strong upside potentialThis content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

Turtle Beach Corp (HEAR) - Thursday, Jan 18, 2024

Founder, BWS Financial Inc

Hamed Khorsand

Founder

Independent Stock Specific Research

BWS Financial Inc

BWS provides independent stock specific research focused on companies with distinct value that are going through a special situation where there is a tangible catalyst not priced in. The catalyst can be anything from new product, restructuring, M&A, management change, change in business strategy, etc. BWS’s focus is to understand the change and evaluate the potential return for investors.

BWS utilizes a self formed proprietary approach in discovering stocks by putting great emphasis on deep research. BWS does generate short recommendations following a similar criteria.

<ul>
<li>IMMR disclosed last week it has acquired 7 percent of the outstanding shares in Turtle Beach Corp. (HEAR) in the open market, which on a surface level could raise questions</li>
<li>The investment in HEAR could have more to do with IMMR’s approach in targeting companies who have yet to license IMMR’s intellectual property</li>
<li>HEAR is a producer of gaming headsets and not a licensee of IMMR’s IP. There are new headsets coming to market taking advantage of benefits haptics could bring to gaming</li>
</ul>


IMMR disclosed last week it has acquired 7 percent of the outstanding shares in Turtle Beach Corp. (HEAR) in the open market, which on a surface level could raise questions
The investment in HEAR could have more to do with IMMR’s approach in targeting companies who have yet to license IMMR’s intellectual property
HEAR is a producer of gaming headsets and not a licensee of IMMR’s IP. There are new headsets coming to market taking advantage of benefits haptics could bring to gaming


IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/razer-inc" target="_blank" data-smartkarma-citation="entities:24380:1" rel="noopener">Razer Inc (1337 HK)</a>’s scheme was approved at today’s court meeting. The value test passed with 94.74% of the total disinterested shareholders voting in favour of the scheme.</li>
<li>Despite our reservations about the headcount test, the scheme comfortably passed the headcount test with 465 for and just 16 against the scheme. </li>
<li>At the last close and for the 20 May payment date, the gross and annualised spread to the offer is 3.7% and 56.1%, respectively.</li>
</ul>



Razer Inc (1337 HK)’s scheme was approved at today’s court meeting. The value test passed with 94.74% of the total disinterested shareholders voting in favour of the scheme.
Despite our reservations about the headcount test, the scheme comfortably passed the headcount test with 465 for and just 16 against the scheme. 
At the last close and for the 20 May payment date, the gross and annualised spread to the offer is 3.7% and 56.1%, respectively.


<ul>
<li>
<a href="https://www.smartkarma.com/entities/razer-inc" target="_blank" data-smartkarma-citation="entities:24380:1" rel="noopener">Razer Inc (1337 HK)</a>'s FY21 results beat consensus revenue by 8% but came below consensus EBIT by 3%, based on CapitalIQ data.</li>
<li>The management did their best to dampen sentiment by pointing out slowing growth momentum and margin compression due to significant growth investments in 2022.  </li>
<li>We think that the results/outlook do little to increase the attractiveness of the offer. We would be buyers up to HK$2.5 per share (implies 65% deal probability).</li>
</ul>



Razer Inc (1337 HK)'s FY21 results beat consensus revenue by 8% but came below consensus EBIT by 3%, based on CapitalIQ data.
The management did their best to dampen sentiment by pointing out slowing growth momentum and margin compression due to significant growth investments in 2022.  
We think that the results/outlook do little to increase the attractiveness of the offer. We would be buyers up to HK$2.5 per share (implies 65% deal probability).


Razer's Offer Spread Risk/Reward – FY21 Results

<ul>
<li>
<a href="https://www.smartkarma.com/entities/razer-inc" target="_blank" data-smartkarma-citation="entities:24380:1" rel="noopener">Razer Inc (1337 HK)</a>'s scheme document will be released after the FY21 results, which are on 17 March. The headcount test is a key challenge. </li>
<li>
<a href="https://www.smartkarma.com/entities/logitech-international-sa" target="_blank" data-smartkarma-citation="entities:22422:1" rel="noopener">Logitech International SA (LOGN SW)</a>’s investor/analyst day on 3 March underscores Razer’s opportunity and adds to minorities’ grievances that the offer price is unattractive. </li>
<li>Current deal probability implies broadly a 50/50 chance of success with a gross spread of 19%. We would be buyers up to HK$2.5 per share (implies 65% deal probability).</li>
</ul>



Razer Inc (1337 HK)'s scheme document will be released after the FY21 results, which are on 17 March. The headcount test is a key challenge. 

Logitech International SA (LOGN SW)’s investor/analyst day on 3 March underscores Razer’s opportunity and adds to minorities’ grievances that the offer price is unattractive. 
Current deal probability implies broadly a 50/50 chance of success with a gross spread of 19%. We would be buyers up to HK$2.5 per share (implies 65% deal probability).


Razer's Offer Spread Risk/Reward – Takeaways from Logitech’s Investor Day

United States

Turtle Beach Corporation operates as a sound technology company. The Company designs and markets audio peripherals for video game consoles, personal computers, and mobile devices. Turtle Beach serves customers in the United States and the United Kingdom.

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Turtle Beach Corp (HEAR US)

Turtle Beach Corp (HEAR) - Thursday, Jan 18, 2024

Turtle Beach is a leading manufacturer of gaming headphones experiencing strong activist involvement from the Donerail Group led by William Wyatt

Value Investors Club (VIC)

IMMR: No Beach for License Evadors

IMMR reported an activist position in Turtle Beach Corp. (HEAR) and news of Razer introducing hypersense headsets. Both companies are not current...

BWS Financial Inc

Razer’s Scheme: And that Is a Pass

Despite our reservations, the scheme comfortably passed the headcount test with 465 for and just 16 against. At the last close and for the 20 May...

Arun George

Razer's Offer Spread Risk/Reward – FY21 Results

The management did their best to sound downbeat by pointing out slowing growth and margin compression in 2022. We think that the results/outlook do...

Arun George

Razer's Offer Spread Risk/Reward – Takeaways from Logitech’s Investor Day

Logitech’s investor day on 3 March underscores Razer’s opportunity. Current deal probability implies broadly a 50/50 chance of success with a gross...

Arun George

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