February 16, 2021- Tesla Discloses $1.5 Billion Bitcoin Investment. Has the Institutionalization of Bitcoin Arrived?
Brookfield Infrastructure Launches $13.5 Billion Hostile Takeover of Inter Pipeline. Will They Be Successful?
Fuel Cell Truck Startup Hyzon Motors to go Public Through SPAC Decarbonization Plus Acquisition. Is the Market Tired of EV SPACs Yet?
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Welcome investors to the Absolute Return Podcast. Your source for stock market analysis, global macro musings and hedge fund investment strategies. Your hosts Julian Klymochko and Michael Kesslering aim to bring you the knowledge and analysis you need to become a more intelligent and wealthier investor. This episode is brought to you by Accelerate Financial Technologies. Accelerate, because performance matters. Find out more at www.Accelerateshares.com.
Julian Klymochko: Welcome podcast listeners to episode 115 of The Absolute Return Podcast. I am Julian Klymochko.
Michael Kesslering: And I’m Mike Kesslering.
Julian Klymochko: Today is Saturday, February 13th, 2021, a few notable events happening in the market this week.
- Off the top, Tesla disclosed a $1.5 billion dollar investment into Bitcoin, which made, you know, the pundits go crazy. The skeptics go mad and the price of Bitcoin surge. Has the institutionalization of Bitcoin arrived?
- Some very interesting news in the M&A space. First hostile, first large hostile takeover we’ve seen in a while as Brookfield infrastructure launched a 13.5 billion hostile takeover of Inter Pipeline, will they be successful in this proposed unsolicited offer?
- Lastly, in SPAC news, fuel cell trucks, startup Hyzon Motors to go public through SPAC de-carbonization plus acquisition. Is the EV market tired of EV SPACs yet, or do they continue to love it?
Start of Podcast
TESLA DISCLOSES $1.5 BILLION INVESTMENT
Julian Klymochko: Mike let’s find out, but first let’s talk about Bitcoin. Electric vehicle manufacturer, Tesla disclosed that and invested 1.5 billion of its cash into Bitcoin. Interestingly enough, they didn’t press release this or anything. It was a footnote in their annual financial statements, 10K. I believe not only that, but Tesla indicated they would also begin to accept Bitcoin as payment for their product. So, if you’re in the market for a new Tesla Model S or Model 3 and owns some Bitcoin, perhaps you can pay for it with that cryptocurrency, if you’d like in the future. Elon Musk, Tesla’s CEO and the world richest man. So, he’s got to be pretty smart, right, Mike? Nonetheless, he’s perhaps the most high-profile business leader to put a stamp of approval on this asset class and, how do they do it? Well, Tesla ended the year with more than $19 billion of cash on hand, they raised 12 billion in ATM financing over the past year at the market equity offerings, really just sell into the market, given the demand for their shares and taking advantage of a nearly 700% surge in their share price last year. So basically, they had a lot of cash on their balance sheet, and we’re likely concerned about the U.S. dollar as we’ve seen with other corporations and investors doing and where else to go? Well, one place to go where an asset can serve as a store of value that can’t be printed by governments is Bitcoin. Why is this development so important? Well, in my opinion, given Tesla’s position as a major component of the flagship S&P 500 index, which is the most popular stock market index in the world, Tesla is in the top 5. They are a large weighting in the S&P 500 and the S&P 500 is the most popular index with investors in the world. Now, Tesla’s Bitcoin investment introduced this cryptocurrency to millions of investors’ portfolios, because now if you own the S&P 500, you do have exposure to Bitcoin, whether you like it or not.
So cool on Tesla. First, they get into the S&P 500, which is the premier index in the world. It covers U.S equities, which are increasingly global these days. Tesla has been, you know, one global company, but now any S&P 500 investor has exposure to Bitcoin. Granted it’s small, but nonetheless it is there, which signifies a major step for investors and a major step for this asset class. To give you a scope of the size of the implications of this, $11 trillion of investment assets are tied to the S&P 500 or benchmark to the S&P 500. So, it just gives you the scope of how important this development is, but Tesla, they’re the first in the S&P 500 to do it, but not the first major corporation to do it. This move followed similar investments by MicroStrategy, which we’ve discussed on the podcast in the past, their CEO, Michael Saylor, he’s become a Bitcoin evangelist. You know, he’s a Bitcoin maximalist, definitely bullish on the asset class. Made a lot of money doing it, perhaps one of the greatest prop bets ever. I think Michael Saylor made over a billion dollars thus far, mark to market on his Bitcoin investments at MicroStrategy.
He recently held a webinar on how corporate treasurers should move some cash into digital assets such as Bitcoin. And so far, MicroStrategy has spent about 3 billion on Bitcoin. I’m not sure when Tesla made that move, but I do know on Twitter and Michael Saylor is very popular on Twitter, and there’s no one more popular than perhaps Elon Musk on Twitter. Michael Saylor did have a tweet compelling Elon Musk to put some of Tesla’s cash into Bitcoin. So not sure if they already preempted that, or if they actually listened to that advice. Nonetheless, Elon Musk did it, put hashtag Bitcoin in his Twitter bio last month, which you know, from my perspective, I thought that was a good indication that Tesla may start to move into Bitcoin.
And that was my prediction that I tweeted about last month and it did come to fruition and you look at the price action on Bitcoin, it was a major catalyst, for example, Bitcoin, it serves 24.1% this week, obviously a lot going on there, but certainly this Tesla news contributed to that surge. To give you a sense of other companies getting into Bitcoin aside from Tesla and MicroStrategy who were in for the billions, Square previously bought $50 million of Bitcoin, you had Massachusetts Mutual Life Insurance Company buying a $100 million of Bitcoin for their investment accounts. So, this is just a trend that will keep on continuing. We’ll see increasingly more corporations do this, more corporations in the S&P 500. I guarantee you will see more with Bitcoin on their balance sheet. Probably not to the tune of 1.5 billion. I mean, there’s not a lot of companies that could do that. We’ve seen about two so far: MicroStrategy and Tesla, I wouldn’t bet a lot, but you know, fifty hundred-million-dollar checks, we’ll definitely see that more and more in the Bitcoin space. Mike, what are your thoughts on what, I perceive to be a major development for the asset class? Are you as bullish on it as I am?
Michael Kesslering: Yeah, I mean, ultimately, I don’t think this was a defensive move by Tesla, whatever they say about their concern around the U.S. dollar or any of these companies. I think it’s more of an offensive move to try to get a higher valuation multiple, which is, I mean, from their perspective, if you can take actions to, you know, juice your multiple, that the market is willing to give you, you should do that as a management team. So, there’s certainly nothing wrong with that. I’m not saying that in a derogatory sense, that’s just kind of logical.
Julian Klymochko: So, what are your thoughts on like, say creating shareholder value? Do they do that through the Bitcoin investment going up in price? Are you saying this improves the marketability of their story and improves there you know, bring more investors into the stock?
Michael Kesslering: More so the latter is that it, presumably can, what we’ve seen historically, when companies do make announcements such as these is they kind of have an increase in their multiple.
Julian Klymochko: Right, Sentiment. So, sentiment driven.
Michael Kesslering: Yeah, sentiment driven. And part of that is that yes, there’s an increase in sentiment because, you know, Bitcoin, now they’ll start tracking that a little bit. They’ll have a little bit higher correlation with Bitcoin and Bitcoin has gone up historically. But with a lot of volatility, but has historically you don’t perform very, very well. So, it makes sense. The other thing I did want to highlight when you mentioned some of the companies that are getting involved in Bitcoin, just today, we’re recording this on Saturday. But just today, it was announced there’s an article came out that Morgan Stanley, one of their investment units, Counterpoint Global, that they’re looking at investing in Bitcoin. They manage $150 billion, so even if they’re looking at a sub 1% allocation to Bitcoin, I mean, that’s still pretty substantial. So, I just think that’s, it’s a very interesting development to watch. And I mean, there’s going to be more and more of these. I mean, are we going to cross 50K this next week? As the market digests, some more of this? I mean, I think it’s certainly a pretty high probability.
The other aspect is, I guess there’s kind of multiple things here is, you have the value of Bitcoin. So, say as a store value and then Tesla, I guess, using it as a form of payment, which they’re doing, and they haven’t committed to that long-term. It sounded like it was, they’re going to try it out short term. So, who knows if they’ll do that moving forward, but I mean, it really brings up the age-old debate about Bitcoin, is it a store value or a payment currency? And, you know, I’ve always leaned towards the store of value line of thinking, because I mean, I’ll bring up one crazy stat that, you know, I saw last year was that 60% of Bitcoin in wallets. It hasn’t moved in the past year.
Julian Klymochko: Right.
Michael Kesslering: And so, if that’s not an indication for the store of value argument you know, I mean, that seems pretty strong to me as well. So then when you’re looking at, you know, what is a Bitcoin worth? Comparing it to other stores of value is kind of how you would go about that if you wanted to do a valuation of Bitcoin, but regardless, people ascribe value to it. So that is one thing to keep in mind. Maybe you don’t agree with that. As, you know, just the general listener or the general investor, you may not agree with that, but other people are valuing it, so that is something to take into account.
Julian Klymochko: Yeah, certainly with it trading at around 47,000 per Bitcoin with a market capitalization of nearly 900 billion, I think its kind of tough to deny that it has value as a store value asset. I’m less bullish as a payment mechanism because with its limited supply and obviously a phenomenal investment performance, it’s a deflationary asset, right? And no one wants to sell assets like that because if they buy a Tesla with one Bitcoin and in 10 years, Bitcoin’s a million dollars per coin, then they’re going to regret that, right?
Michael Kesslering: It’s also why you’re not using say common shares to go pay for your milk at the grocery store as well, right? It’s fairly solid rationale. And I mean, even on the payment side, if crypto does take a form of everyday payments, it probably just won’t be Bitcoin, just because Bitcoin payment processing network of Bitcoin just couldn’t really withstand that.
Julian Klymochko: The Lightning Network could, but it doesn’t make sense because people don’t want to use it.
Michael Kesslering: Exactly.
Julian Klymochko: They want to spend their cash because cash is government mandated to decrease in value by roughly 2% per year or more.
Michael Kesslering: Exactly, yeah.
Julian Klymochko: Definitely take that into account. I don’t expect the payment thing kind of a non-event, but buying 1.5 billion massive events, I believe the institutionalization of Bitcoin has arrived, the signs are there. If you’re not on the Bitcoin train, you know, there’s only one way to go, can stay bearish forever. And those who have stayed bearish since 2013, I’ve been embarrassingly wrong. Do have to disclose that Bitcoin has a 10% weight in The Accelerate OneChoice Alternative Portfolio ETF only ETF in Canada that has exposure to Bitcoin.
BROOKFIELD INFRASTRUCTURE LAUNCHES $13.5 BILLION HOSTILE TAKEOVER OF INTER PIPELINE
Julian Klymochko: Let’s move on to some super interesting M&A news. I always love it when we see a hostile takeover. Tough to find something more exciting than that. Especially some of the M&A tactics behind Brookfield Infrastructure and they’re a hostile takeover of Inter Pipeline. What happened here was that Brookfield infrastructure built up a nearly 20% stake in Inter Pipeline, and they did this incognito. They were very secretive and they structured it in a very unique way to capitalize on certain regulatory loopholes. Because in Canada, if you go above 10% ownership, you need to disclose via what’s called an early warning report. So, what Brookfield Infrastructure did is they bought just under the 10% level, then increased to nearly 20% via total return swaps. So, they found a loophole in the regulations. They’re aggressive, and they took it up to the 20% level, which is really the maximum they can take it to. And then they revealed a bear hug letter and a bear hug letter in M&A parlance is an unsolicited offer that in a letter that you submit to the target company’s board of directors, and then you make it public, it’s basically like a big bear coming in and just like trapping you, and your kind of stuck. And that’s where Inter Pipeline bind themselves. Now they are officially in play due to this $13.5 billion-dollar hostile takeover from Brookfield Infrastructure. So, Brookfield exact state cause 19.6, 5%. They approached Inter Pipeline board about this potentially friendly deal last fall, and rebuffed typically acquires don’t go hostile initially. They’ll always try to do it on a friendly basis because it’s way easier and hostile takeovers can be relatively difficult to complete, not to mention all the social issues. At the end of the day business are run by people and people tend to not look upon positively to a, when their company gets taken over in a hostile situation.
But nonetheless, some other interesting dynamics Brookfield offered to increase the $16.50 per share takeover bid to a range of $17 dollars to $18.25 per Inter Pipeline share. If they’re granted access to due diligence materials, obviously this deal thus far, they’ve only done desktop due diligence, meaning a review of any sort of public information to the filings, et cetera, but they don’t have private information that they would get via a data room and other due diligence materials. So, there is room for them to increase the price and the reason they said that, and they came out and said that publicly being like for shareholders to put pressure on Inter Pipeline board to enter into discussions because shareholders know this carrot out in front of them of roughly 10% or nearly 10% increase in price. If the board of directors engages in discussion. So, they’re kind of forcing them into it.
Brookfield called Inter Pipeline stock market performance, and its credit rating strained in a release. And they also stated that Inter Pipeline has, quote, “Delivered the lowest one-year and five-year total shareholder returns among its Canadian infrastructure peers.” So why that analysis in statement is important is because Brookfield is saying that the current board of directors and management have not been good stewards of shareholder capital. Brookfield could do a better job, and shareholders are no doubt fed up with the poor share price performance and some of the management strategic decisions that were historically made to put them in the spot. Basically, you know, they bet the farm on a recent development project, The Heartland Project, which has been mired in cost, overruns, delays, and their share prices suffered. Certainly, the pandemic did not help and it put them in a compromising position, which ultimately, they now find themselves in play. Thus far Inter Pipeline board of directors have rebuffed the approach. They did come up with a statement on Thursday stating that even the sweetened offer to $17 to $18.25, up from $16.50, did not reflect the true value of the company. I would like to remind listeners that in July of 2019 Inter Pipeline board of directors turned down a $30 dollar per share takeover bid from CK Infrastructure. And they’re not looking good now with a bid nearly half the price, less than two years later. Mike, what are your thoughts on this really interesting hostile takeover situation, which we haven’t seen in a while, especially in the Canadian oil patch?
Michael Kesslering: Yeah, for sure. I mean, well, specific to the $30 dollar offer
from CK that was backed by Lee Ka-shing that offer, I mean, it’s the rationale for them turning it down was they didn’t believe that they would be able to get investment Canada approval.
Julian Klymochko: Right.
Michael Kesslering: So, I think that’s kind of fair. Its kind of puts a lot of turmoil around with the company that, you know, pretty well probability that’s the deal ever goes through. So, you know, I wouldn’t really fault them too much for that. But you know, looking at the background of the deal, you know, both Inter Pipe and Brookfield did come out and say that, you know, previous proposals by Brookfield in November, December, we’re in the $17 to $18.25 range, but there were terms and those were conditional on exclusivity for Brookfield. So, you can understand why the company, if they are making the decision to sell themselves, why not have an auction then? Really, you know, not necessarily to give them exclusivity, unless they’re going to really blow their socks off with like a knock-out bid. Brookfield historically will not just come with a very generous bid. They’re very, very, very astute acquirers.
Julian Klymochko: Price sensitive and discipline.
Michael Kesslering: Yeah, price sensitive. I mean, that’s as a Brookfield shareholder. That’s something that you very much want in a company that doesn’t plenty of acquisitions. As well, I mean, in that offer they did have a go shop and, we we’ve talked on the podcast before around go shops, typically private equity firms give target companies a go shop. It’s really just a way that they can pay a little bit less because the vast majority of go shops do not result in a competing bid. But you know, the other really interesting thing that you mentioned is, is The Heartland Project. And I mean, really, there’s kind of a few scenarios that can play out here. And I would say if you’re probability weighting everything, the majority of the probability is weighted towards Inter Pipeline being sold, whether it’s to Brookfield or competing better. They’re now in play. So, it’s a very high probability that they do get acquired in my opinion. The only other possibility that I see, unless Brookfield just backs out for some reason is that they announced an equity partner for their Heartland petrochemical project as, you mentioned, it is a significant bet for the company. And, you know, I think there’s a lot of talk amongst investors and the company that there’s definitely a delta in what the company thinks it’s worth and what investors are attributing to the project. If the company is able to come out and announce an equity partner in the project that you know, ascribes a pretty high valuation to the project.
Julian Klymochko: Right.
Michael Kesslering: Perhaps that’s a route forward. But outside of that, it seems like it’s almost a certainty that they would be acquired by someone.
Julian Klymochko: Let’s get into the mechanics of that. Because prior to this bid. Shareholders, the market viewed Inter pipeline has been worth $13.40 cents, which is where it closed on Wednesday prior to this hostile bid being announced. So, in order for Brookfield to be successful, they need to buy more than 50% or, you know, if they want to take them, you know, fully over 66 and two thirds, in order to complete a second step plan of arrangement and take them private, they need a mechanism to actually get their hands on these shares, i.e., they need a sufficient number of shareholders having their pipeline to tender their shares at the specific price. Right now, the offers at $16.50, they did indicate $17 to $18.25 if granted access to due diligence materials. So, Mike you’re indicating if in the short term, Inter Pipeline can strike a JV that will be so accretive to shareholder value, that it will increase the share price above the range that Brookfield has cited, you know, and then Brookfield walks away just because they’re not willing to pay the price that the market is?
Michael Kesslering: Yeah, that’s certainly a possibility. I mean, you know, I wouldn’t say that’s the highest probability, but that’s the only other real possibility. And one other thing to mention is that, I mean, in the shares that Brookfield has already acquired, I mean, the 52-week range on, on IPL is pretty wide. And there was a lot of pretty favorable entry points. They started accumulating their position in March of 2020, you know, I would be very interested to hear what their average price.
Julian Klymochko: They went from $20 dollars down to $5.
Michael Kesslering: Yeah, if they were acquiring near the bottom end of that range. I mean, theoretically, even if they ascribed, you know, at $20 dollars share price to the entire company, you know, they were able to decrease the price that they ultimately have to pay on a portion of that.
Julian Klymochko: Right.
Michael Kesslering: But the other things that I did want to bring up just outside of this, I mean, that day was a pretty big day for Calgary teams, about 40 minutes after the hostile bid was announced, you had the Arc Resources and Seven Generations Energy announcing that they were combining in a shared deal. And so, I mean, with that deal, I mean, it’s just a strategic deal, kind of makes sense. Both are well operated, EMP players, have obvious benefits to scale, but, you know, nice to see as Calgary residents the activity in the space in Calgary, for sure.
Julian Klymochko: Local investment bankers, very busy for the first time in a long time, nonetheless Inter Pipeline, in my opinion, will Brookfield infrastructure be successful? I think so. I think this is high profitability. If I was a betting man, which I am, I think that they’re going to win in an auction process. So, number one, we do know that Inter Pipeline is now in play and Canadian regulations differ from U.S. with respect to a poison pill. What I think will happen? Inter Pipeline will adopt a poison pill if they don’t already have one and poison pill prevents Brookfield from buying any more shares in the open market or via their hostile takeover offer.
But in Canada, or, sorry, I should talk about poison pills in the U.S. and this is a, just say no defense. If a board of directors wants to just say, no, they put into place a poison pill. And what that poison pill does is set a certain threshold of what an investor can buy of their shares. Say 10% precent in this case, it’ll be 20% precent. And if an investor goes over that threshold, then the company will issue very cheap stock to all other investors, to dilute the investor that went over that threshold, so that’s how poison pill works. And in the U.S., they can stick around indefinitely. However, in Canada, if a target company adopts a poison pill, the acquire well apply to get it cease traded, i.e., basically counseled by the court and the court will do that after a hundred five days. So, they allow the company to basically shop themselves, run a process over 105 days. And then after that Brookfield Infrastructure can run the tender and take up shares. If shareholders are tendering. Where the stock is at right now, it’s $17.43, obviously significantly higher than the $16.50. So, the market’s pricing in a bump in price to that $17 to $18.25 per share. You know, clearly, they’re going to bump here. I assume they’re going to strike a friendly deal, Inter Pipeline, will implement the poison pill, run an auction process. See if they can find any other buyers. I think that’ll be unsuccessful because they want some competitive dynamics. However, the appetite for other companies to want to go against Brookfield. Who number one, has a tremendous amount of financial firepower. And number two, already owns 20% precent of the company. You’re not going to find a lot of appetite for those type of competitive dynamics, because any competing bidder would be at a massive disadvantage just based on size and toehold cost-based basically. So, I think they’ll get it done
Michael Kesslering: Their debt position, as well as a little bit of an issue for other strategic acquirers is whether they want to increase their own leverage by taking on IPL at its current leverage level, could be a little bit of an issue.
Julian Klymochko: Yeah, exactly. And so, they need to be a very large company and then helps if they’re Canadian. Cause then it introduces investment Canada risk and things of that nature that further put them at a disadvantage. So those are my thoughts on where things are going to head here, market. I guess the market agrees, Inter Pipeline shares rallied 31.7% percent this week on news of the bid market pricing in a better offer than $16.50. Do have to disclose that we are short in The Accelerate Enhanced Canadian Benchmark Alternative Fund symbol, ATSX. And this is not a bet on the M&A situation. This is a legacy short position in a quantitative strategy. It was a phenomenal short for a long time. Obviously, this week, a poor short. Interesting situation, nonetheless, we will monitor it closely. I know position from a M&A perspective in our arbitrage fund though.
FUEL CELL TRUCK STARTUP HYZON MOTORS TO GO PUBLIC THROUGH SPAC DECARBONZATION PLUS
Julian Klymochko: let’s get onto some SPAC news to wrap things up here, Blank check company Decarbonization Plus Acquisition, and finding these days, they have more and more unique names and a good from a marketing perspective, I guess they did announce a business combination with Hyzon Motors, which is a supplier of, you guessed it, zero emissions hydrogen fuel cell powered commercial vehicles. So, another sort of sustainable technology, zero emission EV deal. This was valued at 2.1 billion, interesting to note is the structure was a bit different. So, Hyzon was spun out of their parent company, Singapore based Horizon Fuel Cell Technologies, which has been developing fuel cell tech for commercial applications for almost two decades, which is really interesting dynamic. I think we’ll see more and more in SPAC land because know 400 SPACs out in the market over 400 Blank Check Companies. And over 350 are now competing for a deal. And there’s only so many private companies out there. So, I think we will see more corporate carve-outs where a SPAC will take on a specific segment of an existing large corporation.
Now Hyzon is relatively developed. It more than 400 hundred commercial vehicles on the road. Using its fuel cell technology. They expect to deliver about 5,000 thousand fuel cell powered trucks and buses by 2023 and targeting annual capacity of around 40,000 thousand fuel cell electric vehicles by 2025. So still early stage, but I believe beyond the rendering stage, which is more than some competitors out there. This deal includes a $400 million dollar pipe financing, including BlackRock, Fidelity, Riverstone, and Wellington. You guessed it, the market did like this deal, not tired of EVs SPACs yet. The shares were up 13.4%, since rumors of the deal broke. And so, this deal was rumored a few weeks ago. They did strike a definitive agreement this week, now trades at a 56% premium to its IPO price. It’s expected to close in the second quarter after which it will trade under the symbol, HYZN. So, Mike all is well in SPAC land, as investors continue to be enamored with zero emission vehicle deal, right?
Michael Kesslering: Yeah, for sure. And you have the usual suspects in the pipe where you have Fidelity and Wellington, they’re involved. I mean, they’re pretty much involved in almost.
Julian Klymochko: Every deal.
Michael Kesslering: Every electric vehicle pipe financing. So, you know, some commonalities within there, but I wanted to go into a little trip down memory lane here with regards to the clean tech space in general, because all of these electric vehicles SPAC combinations, it’s really just reminding me of a report. I remember reading last year on VC investments in clean tech where you had a lot of VC capital the two thousand. It was just flowing into clean tech and as the vintage of these funds matured, their returns were really quite poor. For many of these funds of that vintage they were negative. So, I mean, I remember the CalPERS CIO describing clean tech as a noble way to lose money.
Julian Klymochko: I wonder if they would say the same about ESG now, given they’ve invested you know, billions of dollars into that?
Michael Kesslering: Well, that’s really what, what clean tech about people when they talk about clean tech, they now just refer to ESG.
Julian Klymochko: Sustainability, decarbonization, is a lot of buzzwords.
Michael Kesslering: Different name but the SPAC market for EVs has really just brought a massive revival to the sector for those VCs. And at least at the early stage for those early-stage funds. I would imagine their returns will be quite strong as some of those fundamentals start maturing. It still remains to be seen how the late stage and growth investors do. So, some of the investors that are investing into these pipe financing and things of that nature it’s still remains to be seen how they will do on a full cycle. But so far, those results are quite promising. One thing to note is that for the most part, a lot of the SPAC transactions, it’s not actually technically an exit for these early-stage VCs. In this deal in particular, a hundred percent of the equities being rolled over. And I think it pretty much all of the electric vehicle SPACs that I’ve looked at, you’re seeing that equity be rolled over. So not a firm exit yet, but very promising the results so far on a valuation basis.
Julian Klymochko: Yeah, and one thing to keep in mind with that dynamic is there are some kind of tricks they can pull that I have seen, perhaps they take on some debt, pay out a dividend and then roll their equity and then pay off the debt. Yeah, and then pay off the debt with a pipe financing. So, there are ways to kind of do that in secret, but nonetheless, I mean, that’s an interesting deal. Obviously, the market’s still likes it. We’re happy because Accelerate Arbitrage Fund symbol ARB on the TSX, we do own shares of decarbonization plus acquisitions. So, got to disclose that. Lots of fun things happening in the market this week. I always happy to chat about them. We are always talking about these on-line on Twitter, on LinkedIn, Mike where can investors follow you on Twitter.
Michael Kesslering: They can find me @M_Kesslering.
Julian Klymochko: And check mine out @JulianKlymochko. We wish you all the best in your investing and trading. And until next week, we’ll chat with you soon. Cheers.
Thanks for tuning in to the Absolute Return Podcast. This episode was brought to you by Accelerate Financial Technologies. Accelerate, because performance matters. Find out more at www.AccelerateShares.com. The views expressed in this podcast to the personal views of the participants and do not reflect the views of Accelerate. No aspect of this podcast constitutes investment legal or tax advice. Opinions expressed in this podcast should not be viewed as a recommendation or solicitation of an offer to buy or sell any securities or investment strategies. The information and opinions in this podcast are based on current market conditions and may fluctuate and change in the future. No representation or warranty expressed or implied is made on behalf of Accelerate as to the accuracy or completeness of the information contained in this podcast. Accelerate does not accept any liability for any direct indirect or consequential loss or damage suffered by any person as a result relying on all or any part of this podcast and any liability is expressly disclaimed.