Voltari Corp (NASDAQ:VLTC) continues to move steadily lower in recent days since the spectacular move up from under $1 to highs of $21.72 after billionaire investor Carl Icahn increased his ownership in the Company to 52.3% or 4.74 million shares of the 9 million total float, as well as nearly all of the company’s preferred shares.
VLTC empowers its customers to maximize the reach and economic potential of the mobile ecosystem through the delivery of relevance-driven merchandising, digital marketing and advertising solutions, primarily over smartphones and other mobile devices.
Voltari Corp (NASDAQ:VLTC) makes use of advanced predictive analytics capabilities and real-time data management as well as audience targeting services provided by third parties to deliver the right content to the right person at the right time.
Voltari works as an intermediary in mobile advertising; advertisers pay VLTC to deliver their ads to mobile users and the Company pays website and mobile application owners for the use of its ad space. VLTC seems to be quickly gaining traction with the Company announcing 39% growth in revenues for 2014.
Carl Icahn initially bought a $50 million stake in VLTC predecessor Motricity in 2007, the previous incarnation of Voltari before the reorganization and disposal of most of its assets. His son Brett Icahn and his son-in-law Hunter C. Gary sit on Voltari’s Board of Directors.
VLTC most valuable asset could be the accumulated $410.3 million in federal and $67.5 million in state net operating loss carry forwards. This translates to $187 million in deferred tax assets, which are fully offset by a valuation allowance, because management estimates that the realization of these benefits cannot be reasonably assured before they expire.
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According to Seeking Alpha author Edward Vranic, CFA Voltari’s Deferred Tax Assets Make It A Buyout Target For A Profitable Related Company. he says ”As a majority common stock shareholder, Carl Icahn can compel the company to sell itself to a profitable industry competitor for the purpose of realizing these assets. Voltari has preferred shares that have a total redemption value of $41.2 million, of which Icahn owns 95%. He could either wait until the company becomes sufficiently profitable to pay preferred dividends on the stock, or he could get an immediate pay back upon an acquisition event.”
On March 30 VLTC announced that it has closed its previously announced offering of transferable subscription rights to purchase up to an aggregate of 4,300,000 shares of the Company’s common stock, $0.001 par value per share. The Rights Offering was launched on February 27, 2015, to stockholders of record on February 3, 2015, and expired at 5:00 p.m., New York City time, on March 20, 2015.
The Rights Offering was fully subscribed and, as such, the Company issued 4,300,000 shares of its common stock for total net proceeds of $4.6 million, after fees and expenses.
The shares of Common Stock subscribed for in the Rights Offering will be distributed to subscribers or credited through DTC on or about March 30, 2015. Any excess subscription payments to be refunded to subscribers will be mailed by the subscription agent as promptly as practicable.
Currently trading at a $59 million market valuation VLTC has a tiny float and moves fast on any buying which was a big part of the explosive move VLTC recently made to a high of $21.75. Voltari has a valuable asset in the $187 million in deferred tax assets and has quickly become a favorite of small cap investors. We will be updating on VLTC when more details emerge so make sure you are subscribed to Microcapdaily so you know what’s going on with VLTC.
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Disclosure: we hold no position in VLTC either long or short and we have not been compensated for this article