Popular Post evilpiggyfoofoo Posted June 11, 2023 Popular Post Share Posted June 11, 2023 (edited) Tl;Dr: House Stark wants $8B or 3x initial investment for their shares in The Foundation, which only has $4.5B in currently available assets. They own 33% shares, and even when accounting for half of OWR's shares, they would only receive $2.2 billion. Carthago has made repeated attempts to compensate them for more than what the current market value is, while being ghosted for months. House Stark has a wall of text of claims - but let me boil their accusations down for you into a few bullet points and give some context: House Stark, OWR, and Carthago were a part of Nexus and invested a few billion each into the bank; HS in particular invested ~$2B The purpose of the “bank” was a basically shared bloc fund, the terms were: ~1-2% interest loans Free rebuilds In other words, the bank was barely profitable and was more of an organized effort by Nexus to grow together At the end of Nexus, House Stark wanted to divest and audaciously claimed that, based on the latest stock price, they are entitled to $8 billion, a staggering 3x return on their investments…. The bank was more of a shared alliance fund that had little profits…. So how would it be worth 3x? See below for attached sheet and explanation of actual valuation (bank has $4.5B in equity and $4.4B in outstanding loans) Carthago felt that the latest stock price is a hilariously bad indicator of how much the bank is actually worth, and offered to reimburse a more reasonable amount of their initial investment along with some future payments when outstanding loans are recovered, but HS either a.) ghosted or b.) said no CTO attempts at reaching a settlement: Spoiler Last DM communication asking to talk about payment, one of many outreaches: Regarding TFnd Discord deletion, it was to get HS's attention and attempt to respark negotiations: House Stark misunderstands finances, the true value of The Foundation is much less Latest stock prices are never a reflection of the true value of an investment Let's look to basic finance in the real world: If a company fire sales 50% of their stocks today, the stock market would crash and the individual would get much less than the price they expect: For example, when Tesla’s intrinsic value was low but stock price was stupidly high at $1,200; if Elon wanted to cash out for 50% of Tesla’s stock, he wouldn’t get the price of $1,200 per share, he would end up with a lot less If Elon was forced to liquidate Tesla which had like barely any assets compared to the market cap, he would end up with $12 per share. Now back to PnW, The Foundation itself doesn’t have a valuation of $16 billion (HS claims their 33% shares + half of defunct OWR shares gives them $8 billion) Look at the spreadsheet, when accounting for all gains and losses and excluding outstanding loans, there is currently $4,571,483,510.89 in available equity (much less than $16B) to stakeholders. If HS was to sell their equity rather than accept CTO's offer of $2.6B, they would only get $2,285,741,755.45. So House Stark wants to go down the liquidation route? Ok, the bank has ~$4.5B in available liquidity and $4.4B in outstanding loans In the bull case: Assuming all loans are sold at market value and no one defaults, HS would get half of the amount ($4,523,976,611.26) they feel entitled to In the base case: Loans are sold for cents on the dollar and defaults happen because debtors see a closing bank and make a run, HS would be getting likely ~3B Now, I know when HS reads this post, they're going to say "Ok even though the math checks out, Krampus said he would pay $8B over 8 months". A couple things on the screenshot: Here is the full screenshot context Krampus was in the middle of exam season (as he stressed to Ata multiple times) and did not have time to calculate a clear amount After being spammed multiple times about being paid back based on latest stock price, Krampus gave a spit ball offer. Krampus said "I will get back to you" as in ok he will double check the math, talk to the rest of govt, and finalize the offer when he's free "I will get back to you" in no way implies ok this is final lets all shake hands and ink it. After exams, Krampus noticed a spreadsheet mistake that didn't adjust for defaults (OWR deletion caused a few lost loans), Krampus adjusted the value and noticed that HS would actually lose money in the case of an equity pull out. And if all out liquidation happened, they would still get less than $8B Krampus and Jax then made a few different offers to HS which fell apart, followed by months of ghosting. Multiple attempts to reach out and reconnect on a fairer price were reached (check section on "CTO attempts at reaching a settlement") Relying their entire CB essentially on this one spit ball number threw out during exam season is a very weak claim Final thoughts: This seems to be a massive miscommunication issue of he said she said, but the numbers of TFnd tell the best story, the bank is valued a lot less than HS claims it is worth but CTO is willing to negotiate a settlement as long as it is not an absurd valuation. While I agree Krampus should have communicated more clearly about the exact valuation and how the number was reached, at the same time HS should not have ghosted CTO for the past few months. There were plenty of opportunities for due diligence instead of war. The Foundation Spreadsheet: Spoiler Link to spreadsheet: https://docs.google.com/spreadsheets/d/1iiHH9TQdbJwL0ODFeMKSB8UKytl-kFPV/edit?usp=sharing&ouid=113960574788754867012&rtpof=true&sd=true How to read: The cover page summarizes the bank's income and balance sheet. I tried my best to replicate GAAP in a PnW context for those of you with accounting/finance experience Revenue and loan losses are detailed in the third sheet The bank expenses line item include graphics, ads, etc. There was a tech issue that caused a loss of $12B ($11B recovered by CTO), see note for further context The 2nd page is the equity waterfall (how much each shareholder is entitled to). I divided it into a few scenarios. The first one shows OWR-HS-CTO split, the second table shows the amount HS is actually entitled to if they have 50% equity from OWR, the third table assumes the bull case if liquidation goes smoothly and every loan was recovered at market value (unlikely) The 3rd page is the loan sheet, pretty intuitive. Edited June 11, 2023 by evilpiggyfoofoo 8 2 2 22 4 Quote Order fresh quality ads, flags, and graphics at Makin'Bacon! Link to comment Share on other sites More sharing options...
Popular Post Sweeeeet Ronny D Posted June 11, 2023 Popular Post Share Posted June 11, 2023 So it sounds like you need to go call your allies to defend you, rather than declare neutrality. 13 1 Quote Link to comment Share on other sites More sharing options...
MinesomeMC Posted June 11, 2023 Share Posted June 11, 2023 Interesting wall of text, too bad I ain’t reading it all 2 Quote Link to comment Share on other sites More sharing options...
Popular Post KindaEpicMoah Posted June 11, 2023 Popular Post Share Posted June 11, 2023 How dare you write out a well thought out post instead of rolling over! Now I have to use my brain instead of just thinking CTO man bad. 21 Quote Link to comment Share on other sites More sharing options...
Shwin Posted June 11, 2023 Share Posted June 11, 2023 5 minutes ago, Sweeeeet Ronny D said: So it sounds like you need to go call your allies to defend you, rather than declare neutrality. Florida is too scary for us 😭. I'd ask daddy Rose to come hold our hand but I don't think they'll help this time. 1 Quote Link to comment Share on other sites More sharing options...
Popular Post Sketchy Posted June 11, 2023 Popular Post Share Posted June 11, 2023 Just now, Shwin said: Florida is too scary for us 😭. I'd ask daddy Rose to come hold our hand but I don't think they'll help this time. I think the only reasonable course of action here now is for you to hit both of your allies. 1 4 12 Quote Link to comment Share on other sites More sharing options...
CaesarGorandius Posted June 11, 2023 Share Posted June 11, 2023 Just now, Sketchy said: I think the only reasonable course of action here now is for you to hit both of your allies. Why not? A little Chaos is good for the soul Quote Link to comment Share on other sites More sharing options...
Jacob Knox Posted June 11, 2023 Share Posted June 11, 2023 1 minute ago, Sketchy said: I think the only reasonable course of action here now is for you to hit both of your allies. I concur. It is the best, and most based, course of action. Quote Federation of Knox Enlightened of Chaos, Event Horizon QA Team and API Team Link to comment Share on other sites More sharing options...
Jeric Posted June 11, 2023 Share Posted June 11, 2023 Tbh that was a well put together explanation. Anyone that hasnt bothered to read it really should... 5 Quote Link to comment Share on other sites More sharing options...
Popular Post Thalmor Posted June 11, 2023 Popular Post Share Posted June 11, 2023 This actually seems like a pretty good response to the CB. 14 Quote Link to comment Share on other sites More sharing options...
Juuzou Posted June 11, 2023 Share Posted June 11, 2023 #KrampusDidNothingWrong Quote Link to comment Share on other sites More sharing options...
Lord of Puns Posted June 11, 2023 Share Posted June 11, 2023 Tl;Dr shares has always been a terrible way to represent equity in small markets that has a 0% likelihood of being bought out. 3 1 Quote 22:26 +Kadin: too far man 22:26 +Kadin: too far 22:26 Lordofpuns[boC]: that's the point of incest Kadin 22:26 Lordofpuns[boC]: to go farther 22:27 Bet: or father Link to comment Share on other sites More sharing options...
Deraj Posted June 11, 2023 Share Posted June 11, 2023 Typical Krampus Math. 1 Quote Link to comment Share on other sites More sharing options...
SleepingNinja Posted June 11, 2023 Share Posted June 11, 2023 1 hour ago, Sweeeeet Ronny D said: So it sounds like you need to go call your allies to defend you, rather than declare neutrality. :feelsbadman: Quote Link to comment Share on other sites More sharing options...
Nokia Rokia Posted June 11, 2023 Share Posted June 11, 2023 Oh look a war Quote Link to comment Share on other sites More sharing options...
Majima Goro Posted June 11, 2023 Share Posted June 11, 2023 So you agree FOUNDATION is a scam bank. Good good. 1 Quote Link to comment Share on other sites More sharing options...
Istandor Posted June 11, 2023 Share Posted June 11, 2023 Hey HS - I can let you in on this new hot investment, onion futures. literally to the moon. Floor starts at 5B. Quote Link to comment Share on other sites More sharing options...
Ramona Posted June 11, 2023 Share Posted June 11, 2023 (edited) To whom it may concern, Consultant Ramona for GO Associates here (on $50m/hr, and best believe that I have marked down 90% of those hours for skiing seshes in the strip club) to audit the accounts of Jim and TheKidMadeIt! (both under account number 203465). On the account of TheKidMadeIt: $210m loaned (confirmed) $50m paid (confirmed) $90m paid (confirmed) $4.2m paid (confirmed) $74.4.... paid (confirmed, numbers are for the diversity hires, i'm a nepo hire, no thanks) Loan confirmed completed. On the account of Jim: $950m loaned (confirmed) $160m paid (confirmed) $700m paid, This is where things get tricky, it appears my own tax avoidance strategy has caught up to me (I moved to Eclipse, uncommon Ramona L move) and it seems that these payments went through tax havens, the records I haven't got access to. I'll assume in good faith that this payment went through (and thus confirmed) as the party related to account number 203465 isn't known for breaching the terms of financial contracts. $125.61m paid, Read above, from reading the sheet I assume that I underpaid by the amount in brackets on the sheet (don't look back in anger yadda yadda). On the account of Madden Red: This name is not associated with account 203465 despite being under that account number, I put this down to a classic dumb admin keying error, god those admins are some dumb, part of the reason while they'll never have my job, other reason being that they don't have rich parents to give them high up jobs. --------------------------------------------------------------------------------------------------------------------------------------------------- Unrelated Announcements: We at GO Associates extend our farewells to recently retired consultant MCM after she hit the glass ceiling. I will be working with the lobbying group Farmers Union to ensure farming nations get a fair deal in recent discussions with Game Devs on tackling rampant inflation caused by the low tier. I have also been researching of the behalf of smaller alliances to protect their spies from those who wish to gain kills off of their spies to "stat pad". No, there isn't conflict of interest in this affair. --------------------------------------------------------------------------------------------------------------------------------------------------- Feel free to waive my incoming invoice through Accounts, do not send it to Legal. Edited June 11, 2023 by Ramona Forgot to add invoice notice. 2 2 Quote Link to comment Share on other sites More sharing options...
Zevari Posted June 11, 2023 Share Posted June 11, 2023 I have no experience in banking in this game, but 11 billion in defaults seems ungodly high when you only had 7.8 billion initially invested. Is it really that normal to lose around 1.5x your starting funds to defaults? Quote Link to comment Share on other sites More sharing options...
Danzek Posted June 11, 2023 Share Posted June 11, 2023 (edited) 3 hours ago, evilpiggyfoofoo said: House Stark misunderstands finances $550m borrowed, with $393,953,672 repaid is not a $475,349,033.88 loss. All the defaults where payments were made look incorrect to me? Edited June 11, 2023 by Borg Quote Link to comment Share on other sites More sharing options...
evilpiggyfoofoo Posted June 11, 2023 Author Share Posted June 11, 2023 Just now, Borg said: $550m borrowed, with $393,953,672 repaid is not a $475,349,033.88 loss. All the defaults where payments were made look incorrect to me? Good catch, I must have misclicked while getting this in by DC. I have adjusted the equation. It had an overall small impact on the numbers - and brings HS to an equity value of $2.5B. Still far under their valuation of $8B. 1 hour ago, Ramona said: On the account of Madden Red: This name is not associated with account 203465 despite being under that account number, I put this down to a classic dumb admin keying error, god those admins are some dumb, part of the reason while they'll never have my job, other reason being that they don't have rich parents to give them high up jobs. I corrected the ID using old logs, hopefully this helps. 1 Quote Order fresh quality ads, flags, and graphics at Makin'Bacon! Link to comment Share on other sites More sharing options...
Popular Post George Clooney Posted June 11, 2023 Popular Post Share Posted June 11, 2023 24 Quote Link to comment Share on other sites More sharing options...
Spoeb Posted June 11, 2023 Share Posted June 11, 2023 House Stark good Quote Link to comment Share on other sites More sharing options...
Emeralds Posted June 11, 2023 Share Posted June 11, 2023 Yes, we humans are prone to errors. Two wrongs cannot make a right. I will advise HS to reconsider and take what have to be offered to them now. The Orbis Peace Organization(OPO) will want both side to end hostility. 1 Quote Link to comment Share on other sites More sharing options...
Keegoz Posted June 11, 2023 Share Posted June 11, 2023 Will be interesting to see how HS responds to this. That's assuming they do at all. 2 Quote [11:52 PM] Prefontaine: But Keegoz is actually bad. [11:52 PM] Prefontaine: He's my favorite bad leader though. Link to comment Share on other sites More sharing options...
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