JBI Speculative Theory
Caution: Reading this may cause the skeptical observer to vomit and diarrhea at
the same time. Hopeless romanticism ahead. This felt like an epiphany moment as
it put the pieces of the puzzle together for me in a way that always eluded me.
Again, this could be hopeless romanticism gone terribly wrong, and I am open to
that possibility.
This is all speculation. I spend hours analyzing the
situation, and it's easy to get carried away. So many twists and turns, and
OOHHHHHH soooooooooo much drama.
The drama causes an epic wave of additional skepticism on an already too good
to be true proposition. It's a fine line between scam, something that was once
possible, but has to now be a "scam"(viability isn't possible, and
the towel needs to be thrown, but entity fights as long as there is a
heartbeat), and a viable enterprise.
I would estimate there is a 20% chance that P2O fails for JBI, or is taken over
for pennies on the dollar. Downward spiraling
financing is exerting it's control on
the company. A company can survive longer than people imagine, but eventually
the downward spiral access to good capital will choke it to death. JBI could
still have a few more waves of capital infusion, but the choke hold will get
tighter and tighter.
One comment on the drama, is that it's something that should be expected with
"too good to be true" scenarios. Ego plays a big role. There are
countless stories of all the drama involved with other major breakthroughs in
technology, science, and business. Scientists in their thirst for discovery
will do crazy things with rival scientist. You can read many examples in
"A Brief History of Nearly Everything."
On to the speculation:
The foundation of the speculation is that P2O and JBI has always been about a
buyout. If I'm wrong, then everything I'm about to speculate on is dead wrong,
and I'm just pissing in the wind. It's always good to have a friend that can
tell you that you are just pissing in the wind.
This is about building as perfect a mousetrap to get an entity to sign the dotted
line for a major buyout. FDA approval and buyout in drug company example. Many
of the things that we can't understand with the moves made and most importantly
the production, are due to the allure and dance with a large entity for buyout.
I don't know who that entity is, but to make it easy, I'm going to say Waste
Management. I think they would be the most likely candidate.
Waste Management has billions to
invest and help expand their
shareholder value. They've throw billions around, knowing that if they hit
1/10, they break even, and 2/10 becomes huge profit. That doesn't mean they
aren't conservative at times. They have been burned, or had less than stellar
results with many of their investments. John Bordynuik is in the classification
of risky inventor that Venture Capital typically are weary of. This adds a
double whammy(risky inventor, blown past waste to
fuel investments) of conservatism
towards JBI.
WM and John are in a dance, and John is playing it brilliantly.
WM's conservatism probably ticks John off. I don't think there has been
motivation to build several processors, or go to a RKT site. I think he wishes
the buyout race was already in full throttle. He is as sick of the process as
the investors. Nah, probably exponentially more so. John is any shareholders
"ticket out of here", so everyone should just chill, and wait to
collect their effin check. Got it, get it? Good.
Due to some issues that have taken longer to fix and engineer, the RKT deal
probably was about to fall through. They probably felt the lack of interest and
ability for JBI to get there. It was saved by Rauber and John. Rauber isn't in
this for the long haul. He's here for the buyout. For the best buyout, you need
leverage. RKT was always just leverage. To accomplish the best leverage, you
have to show that you have a good choice in not taking the buyout price, and
just executing the RKT deal. JBI is now unwillingly having to setup for
executing the RKT deal. Rauber and Boglin are here to do that. Luskin, Dorrell,
etc. know what is at stake and down to dance.
Now, I think that WM is starting to get cozy. I believe they have milestones in
place. Thresholds that when surpassed, they up their ante. Step 1 is either a
straight buyout, or taking a stake. I'll estimate 15-25%. That protects them if
someone else buys them out, and gets the ball rolling on control and the full
buyout. JBI probably wants $50. I'd guess the offer is around $7ish now, but if
milestones are met, could quickly get to $12-15.
Key thresholds:
Land plastic supply agreement, even if you have to pay. I believe
evidence is showing that they don't have access to the best feed
stock. You hear about them picking
plastic up from people and places. Apparently, someone isn't just dumping them
the best feed stock for free. Or, it's simply that JBI isn't ready to collect
as much plastic as a contract would be for until they are in higher production.
RKT plastic is probably mostly a film for their packaging, so most of the
design and focus has been for that. I imagine taking thick
gas tanks are the better feedstock though.
WM has a lot of access to this.
Run tickets from 1 machine for 3-5 weeks in a row.
Have two processors running continuously, even if it is only 1 ton/hour.
If two or three of these things occur, I think the buyout number gets to $12+.
The SIAC report with the pro-forma numbers were for the buyout. Another peer
review may be in order with 2 processors to cross compare.
JBI probably wants $50, but I do believe they'd sign for $20, with the strong
hope it is $30+. They can weigh RKT deal and other potential deals up with the
buyout offer. It will be a great, but tough decision. The better that
mousetrap, the better odds of getting that $30+. They may have to execute the
RKT deal more than they wish. They may have to get a 3 processor cluster
running, but it just depends on the the belief in the SIAC report and Niagara
plant results. I do think step 1 would activate before RKT execution of 3
processor cluster, though.
I could be very wrong, but I am an idiot.
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