KUT
🚚 Operated a non-scalable but interesting business providing on-site data destruction (hardware, paper) primarily for SMEs using specialized trucks.
💰 Grew by consolidating the fragmented market, acquiring smaller competitors’ client portfolios cheaply and integrating them into their service route.
M&A activity led to its acquisition in early February, realizing value for shareholders after a period of cyclical performance tied to paper prices.
@Academiadeinversion:
“Redishred is a Canadian company I no longer hold because it was acquired in early February. It had a non-scalable but very interesting business model focused on SMEs. For micro-enterprises (1-10 employees), it offered data destruction services, both hardware and paper. They used trucks that went street by street in Canada and the US, stopping at businesses to destroy data securely, helping with compliance like GDPR. It wasn’t scalable because as SMEs grow, they usually get these services bundled from larger providers like Oracle NetSuite. Knowing this, Redishred focused on consolidating the market by buying client portfolios from micro-enterprise service providers across the US very cheaply. Once acquired, they’d deploy a truck and integrate the clients, often recouping half the investment within a year. The company’s value realization came when a larger company acquired it, paying a premium (initially offered $7 CAD, settled around $5 CAD) over its trading price. We bought it around $2.40 CAD. Its performance was somewhat cyclical, influenced by paper prices.”
Watch the exact part of the video where @Academiadeinversion talks about Redishred Capital Corp. here:
Watch the video on YouTube
Read more articles analyzing Redishred Capital Corp. (KUT) at the provided link. KUT stock.
