Hello people who have a better grasp of corporate financial issues than myself. With 1B in debt needed to be refinanced in the next 11 months is there a risk of bankruptcy? It looks like Heavy D is counting on the macroeconomic conditions to head north and save us from disaster. Objectively the financial world is talking longer term downward pressure on the economy. Just texting out loud here. I guess they can just offer new bonds and hope for the best.
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"Heavy D". LMAO! HILARIOUS! I grew up in Mount Vernon, NY. We had a rapper called Heavy D. One of his songs was Money Earnin, Mount Vernon. Come to think of it the rapper Heavy D. Is just like our Heavy D.
The iddiats told us for years the debt. didn’t matter and used it for buybacks and executive compensation. This company has been milked dry and will need to liquidate by next year or be sold
They are selling off the assets already in terms of buildings and land so yes, if the economic conditions continue to be bad Seagate will go bankrupt.
Number one - don’t rely on Heavy D to tell you what the future looks like. He has a vested interest in seeing that’s at their most optimistic.
The future for Seagate depends on profits from the core business and cash flow generation the sale of assets. They key thing to pay attention to are the contractual debt covenants on the existing debt. If profits don’t improve, Seagate could be unable to roll over debt as it comes due. If the debt can’t be rolled over than the only option is to sell assets.
Seagate book value is negative. Meaning the debt is higher than the depreciated value of the assets. Lenders are not likely to want to force Seagate into bankruptcy as long as Seagate can pay off debt when it comes due. The road ahead for Seagate will not be easy for a least a couple of years. This idea that the 2nd half of the year will be better is wishful thinking and part of Big D’s line of BS.