NASCAR Making Move To Buy ISC

aunty dive said:
I didn’t try to insult you. Clearly, your time spent in or around the accounting profession didn’t include anything involving mergers / acquisitions.

We have nothing to indicate that if the deal gets done, ISC will cease to be an operating corporate entity. With all the TV and corporate race / track contracts currently in place, prior tax years deals, etc., etc. ... why would it?
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So what is the point of buying out all the shares (65% currently not owned by Lisa and Jim) and who will be the owners of those shares?
 
Control.

The owner(s) of the purchased shares will be the corporate entity(ies) or the individuals(s) who buy them.
 
NASCAR (The Frances) are essentially attempting to take full operational control of ISC by buying outstanding shares, rather than the divided power that currently exists due to a majority of the company's stock being held by other parties. No indication has been given that a formal merger between NASCAR and ISC is in the works. That could happen at some later time, but it isn't what is occurring at present.
 
Buying back the shares and taking ISC private, whether it gets merged into NASCAR or not, gives Jim and Lesa a LOT more freedom to steer the company in any direction they want, without having to make public every move they make and without all of the reporting requirements of a publically held company. I thought it was HUGE mistake to take ISC public in the first place, and I guess this move is subtle admission that I had a point, but I am a person that has always placed control in front of cash on the priority scale.
 
Unless I misunderstood what I just read, and I easily could be wrong. But on a website called marketeer.com

That website said the France family group owns 92.8 % of the ISC shares. And Jim France has 4.8% and Lesa Kennedy has 0.84%.

I looked it up a few years ago because Moody and I got into it on his radio show. I said Nascar and ISC where in the same building and him being the company stooge said they are not in the same building and not even close to being the same company. And it didn't matter a brother ran Nascar and a sister ran ISC that the companies didn't help each other . B.S.
Anyway I looked it up and at that time the France family controlled 65% of ISC stock.
 
The website is marketscreener.com

I was way off. Never do two things at once. Duh!
 
I would question those ownership numbers. Exactly WHO is the France family that would own THAT MUCH of the stock stock besides Jim and Lesa, and if the family owned 93% of the company, it wouldn't be any big deal to regain 100% control regardless of the stock price. It was always my understanding that the family kept in excess of 60% of the stock, and I would be shocked if any other member of the family has any "control" over that block of shares besides Jim and Lesa, regardless of who's name might be on the shares.
 
Isn't investing in SMI or ISC just sunk cost fallacy at this point? And this is from someone who thinks the ratings will stay like this for a while.
 
aunty dive said:
Control.

The owner(s) of the purchased shares will be the corporate entity(ies) or the individuals(s) who buy them.
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Yes but when all the shares are sold to Nascar and Jim and Lisa don't sell theirs what becomes of the Corporation itself?
 
Unless the board decides otherwise and makes changes, it remains as it is ... the corporation that owns and operates all facets of a significant number of valuable assets.
 
Formerjackman said:
Buying back the shares and taking ISC private, whether it gets merged into NASCAR or not, gives Jim and Lesa a LOT more freedom to steer the company in any direction they want, without having to make public every move they make and without all of the reporting requirements of a publically held company. I thought it was HUGE mistake to take ISC public in the first place, and I guess this move is subtle admission that I had a point, but I am a person that has always placed control in front of cash on the priority scale.
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I wouldn't say that at all. taking a company public usually means a massive windfall for the stock that is sold. at the time nascar was on the rise. Going public could mean a massive cash infusion to the stockholders that sold. Now that the company is trading at a much lower stock price, although I haven't looked I would be surprised if it isn't. That would mean the shares could be bought back at a steep discount. Also there must be some knowledge that gaining back more control of ISC means they expect it to be much more valuable in the future.
 
Or the board - old or new - could convert all the facilities in their portfolio into gigantic Bingo halls.

There’s really no way to know. That’s the beauty of operating as a private corp. as opposed to a public one.

Under the B ... 12!
 
hidesert cowboy said:
I wouldn't say that at all. taking a company public usually means a massive windfall for the stock that is sold. at the time nascar was on the rise. Going public could mean a massive cash infusion to the stockholders that sold. Now that the company is trading at a much lower stock price, although I haven't looked I would be surprised if it isn't. That would mean the shares could be bought back at a steep discount. Also there must be some knowledge that gaining back more control of ISC means they expect it to be much more valuable in the future.
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And there is the problem. Everybody sees dollar signs by going public, but most don't stop to think what they lose. What stockholders want is seldom ever in line with what's actually best for the company. Henry Ford called them parasites, and he had a point.
 
Well, here's what I hope for if the France clan can buy out ISC, Agenda item #1. Fix Bristol. Agenda iten #2, put Atlanta back to it's original configuration. Eat lunch, and carry on.
 
AuzGrams said:
Bruton Smith is trying to buy all of SMI's stock. I'll have to find the article later.
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Here is an article about Smith's plan to take SMI private. Coming on the heels of ISC's similar move, it makes me think the two are somehow tied together strategically. But I can't see how ISC and SMI could really get together soon after going private... if such plans had not been disclosed by management of the two companies to the shareholders who were selling. That would feel like insider trading to me. But something is up, or so it seems.

Smith family offers to buy back non-family shares of Speedway Motorsports Inc.
Nick Bromberg, Yahoo Sports, April 24, 2019


Could NASCAR’s two biggest track corporations both be going private?

NASCAR has already made an offer to purchase International Speedway Corporation. Wednesday, the Smith family revealed that it has made an offer to shareholders to buy back the shares of Speedway Motorsports Incorporated.

From a letter to the company’s board of directors:
Sonic Financial Corporation (“SFC”) is pleased to submit this non-binding proposal to acquire all of the outstanding shares of stock of Speedway Motorsports, Inc. (the “Company” or “TRK”) that are not owned by SFC, O. Bruton Smith, his family and entities controlled by Mr. Smith and his family (collectively with SFC, the “Smith Group”), for cash consideration of $18.00 per share (our “Proposal”). As you know, the Smith Group beneficially owns, directly or indirectly, approximately 29 million shares of TRK, and controls over 70% of the voting power of TRK.

We believe that our Proposal reflects an extremely attractive value to the Company’s public stockholders. Specifically, $18.00 per share represents a significant premium of 31% to yesterday’s closing price and 26% to the 30-day volume-weighted average price per share of $14.27 as of April 22, 2019.

As you know, NASCAR racing has faced several challenges in recent years, and the Company has been impacted by these challenges. NASCAR has indicated the sport would benefit from structural change. We believe TRK would be more able to compete in this challenging and changing environment as a private company.

ISC has long been a publicly held company that was originally spun off from NASCAR. SMI, founded by Bruton Smith in the 1950s, incorporated in 1994. SMI owns tracks like Charlotte Motor Speedway, Bristol Motor Speedway and Texas Motor Speedway. Overall, the Cup Series races at eight tracks owned by SMI.

What does this mean?
SMI’s move to be totally held by the Smith family makes sense after NASCAR’s move to privately own ISC. And it could be a sign that big changes are on the horizon for the NASCAR schedule.

A sticking point in NASCAR schedule renovations has been the publicly-owned status of the majority of tracks on the series’ schedules. With both SMI and ISC potentially going private ahead of the 2020 season, it’s the perfect time for NASCAR to try a long-teased schedule overhaul for the 2021 season. It’s much easier to shuffle a schedule when you don’t have to answer to shareholders.

NASCAR already has made some significant — for them — changes to the 2020 schedule. Those changes included moving the final race of the season from Homestead to Phoenix, a track owned by ISC that recently underwent a massive makeover.

There could also be bigger changes on the horizon too. Companies don’t go from public to private without a lot of thought. You can bet that NASCAR and the two track companies have a long-term strategy in place. And it could involve more than potentially just changing up the schedule.
 
Team Penske said:
^ can't fix what they don't own, that is up to Bruton Smith.
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DOH!!! I'll put in a call to Bruton this afternoon. I bet he'll get right on it. What was he thinking changing Bristol? We need to have a sit down.
 
Bruton owns Sonic Financial, so with making SMI private and now having the bump in finances to lets say make renevations to tracks. This is actually pretty smart to make SMI private and could make SMI an easier sell down the line. Bruton and company can loan themselves out money with his financial instution behind him... Interesting move, very interesting. I think this merger is going to happen sooner than later IMO.
 
Kiante said:
I think this merger is going to happen sooner than later IMO.
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Merger between ISC / NASCAR and SMI?

It's possible, but I don't get the sense yet that's the motivation behind these moves. I think Bromberg and others essentially have it right. Truly major schedule and / or format changes are coming in 2021, and it is much easier to make radical changes without having to answer to outside shareholders and short-term effects on stock price. I could be wrong, but I think that is how these similar moves by ISC and SMI are coordinated for now.

Regardless, the most telling portion of the announcement posted by Lew is definitely:

"As you know, NASCAR racing has faced several challenges in recent years, and the Company has been impacted by these challenges. NASCAR has indicated the sport would benefit from structural change. We believe TRK would be more able to compete in this challenging and changing environment as a private company."
 
Both SMI and ISC went public back in the day so they could raise the funds to buy, build and maintain racetracks. All was well until Nascar wants to go to different tracks. Stockholders for both SMI and ISC can tie up everything under litigation for years if they wanted. And being private they wouldn't be a publicly traded company subject to the ups and downs whims of the stock market. It would make it much easier to sell or take in an investor.
 
gnomesayin said:
Merger between ISC / NASCAR and SMI?

It's possible, but I don't get the sense yet that's the motivation behind these moves. I think Bromberg and others essentially have it right. Truly major schedule and / or format changes are coming in 2021, and it is much easier to make radical changes without having to answer to outside shareholders and short-term effects on stock price. I could be wrong, but I think that is how these similar moves by ISC and SMI are coordinated for now.

Regardless, the most telling portion of the announcement posted by Lew is definitely:

"As you know, NASCAR racing has faced several challenges in recent years, and the Company has been impacted by these challenges. NASCAR has indicated the sport would benefit from structural change. We believe TRK would be more able to compete in this challenging and changing environment as a private company."
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I think a merger will occur and also with SMI being privatzed and not having to deal with public traders in the stock it will be easier to make changes. For instance, lets say we want to make a change to a track or even build another one in a new location. Being privatized means changes can be expedited and not having to concerned about the ebb and flow of the stock market and folks involved.

Oh hell, you already said all of what I just typed. That's what I get for skim reading, but I think we can all agree this is great for the sport. These structural changes are huge and now I think NASCAR along with SMI and ISC realize that those "boom" days are over. Focus on structuring a revamping the financial model, so this is very positive news IMO.
 
Oops, I just realized that I forgot to include the link to that Yahoo story that I posted earlier. That's a no-no, and I apologize for the error...
https://sports.yahoo.com/smith-fami...es-of-speedway-motorsports-inc-130354704.html

Here's what I don't get... If the schedule changes or other Nascar moves are expected to be negative financially for the shareholders of ISC and SMI, why would the France and Smith families want to double down by buying more shares now? I mean, I understand the operational freedom of being a private company... but those outside shareholders are currently exposed to asset values going down. After going private, all of the downside resides with France and Smith; none of the downside exposure will be owned by the outside investors.

It's like owning beachfront property with a partner... and a big hurricane is coming... so you quickly buy out your partner??? It only makes sense economically if you believe the coming adverse factors are *already* baked into the current share price. Financial theory says they are baked in... but is that true even for these smallish companies ruled by the founders who hold absolute control via super-voting shares? I don't know.

The other way it possibly makes sense is if the strategic mission is to merge Nascar + ISC + SMI with the Smith Family angling for 20-22% of the whole... and the France Family planning to sell 20-25% to some third party...:dual9mm:
 
LewTheShoe said:
Oops, I just realized that I forgot to include the link to that Yahoo story that I posted earlier. That's a no-no, and I apologize for the error...
https://sports.yahoo.com/smith-fami...es-of-speedway-motorsports-inc-130354704.html

Here's what I don't get... If the schedule changes or other Nascar moves are expected to be negative financially for the shareholders of ISC and SMI, why would the France and Smith families want to double down by buying more shares now? I mean, I understand the operational freedom of being a private company... but those outside shareholders are currently exposed to asset values going down. After going private, all of the downside resides with France and Smith; none of the downside exposure will be owned by the outside investors.

It's like owning beachfront property with a partner... and a big hurricane is coming... so you quickly buy out your partner??? It only makes sense economically if you believe the coming adverse factors are *already* baked into the current share price. Financial theory says they are baked in... but is that true even for these smallish companies ruled by the founders who hold absolute control via super-voting shares? I don't know.

The other way it possibly makes sense is if the strategic mission is to merge Nascar + ISC + SMI with the Smith Family angling for 20-22% of the whole... and the France Family planning to sell 20-25% to some third party...:dual9mm:
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Because if NASCAR/ISC/SMI knowingly made moves that would decrease shareholder value they would be open to lawsuits from those shareholders which could force a whole series of unwanted changes. A decreased stock price also makes these entities bigger targets for a hostile takeover from a private equity corporate raider, who would be all too happy to strip out assets regardless of what the sport wants. Sadly in the US there is a legal precident for management to accept the highest offer in a takeover situation, regardless of the France family's or anyone else's plans for the sport. Shareholder value trumps all in public companies.
 


I wouldn't think they would want to eliminate tracks where they do get public incentives, but it sure opens up many possibilities to have races where there are public incentives involved to hold races there.
 
Does this mean is NASCAR still for sale? Haven't heard much about that in a while.
 
Keeping everything in-house.

I like it and if the France family decides to sell, it makes it an easier bulk sell. There is a certain track I would like to see ISC to purchase again in Colorado... I miss Pikes Peak in the truck series.
 
I'm sure this won't make any difference to some who read it, but this sure doesn't seem like they are selling to me. I believe what the France bunch says. That makes me a kool aid drinker to some.

 
NASCAR Apologist said:
A race will be added to Iowa from an ISC track since NASCAR also owns Iowa already.
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Easiest solution would be Michigan or Kansas given they are in the same proximity. Two tracks that don't deserve 2 dates but for some reason everybody wants a better schedule with no casualties.
 
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