Monday, May 15, 2017

Trucking Industry’s Tale of Woe: Too Many Big Rigs


Lets see how this plays out with the banks.....Aivars Lode

A glut of used heavy-duty trucks means some long-haul carriers are ‘upside down’ on their rigs, owing more than the trucks are worth


A glut of used big rigs is weighing down trucking companies already mired in a prolonged slump in the freight market.
Many fleets bought scores of new trucks when transportation demand was booming a few years ago. Then U.S. manufacturing activity flagged and import growth slowed as retailers rang up disappointing sales. Freight volumes started stalling out in late 2015, leaving too many trucks competing for cargo.
Large long-haul trucking companies typically run a truck for three to five years, then trade it before the warranty expires. Repair and maintenance costs tend to skyrocket after about 500,000 miles.
Now, trucking companies are trying to trade in vehicles following one of the steepest plunges in used-truck prices since the recession. Some carriers are “upside down” on trucks in their fleets, meaning they owe more on a vehicle than it is worth.
Large carriers such as Swift Transportation Co., Knight Transportation Inc.and Werner Enterprises Inc. have said the soft market for used trucks has put a dent in their businesses, even though cargo volumes have begun to recover. Last year, some fleets wrote down the value of trucks that are many companies’ main assets.
Demand for new trucks stemmed from companies like Celadon Group Inc., an Indianapolis-based carrier that expanded its truck-leasing division from 750 vehicles under management in 2013 to 11,300 trucks in 2016. 
Over the past two years, the average retail price for a used Class 8 sleeper, the heavy-duty tractor used for long-haul routes, has plunged about 22% to about $49,000 in March, according to J.D. Power Valuation Services. That translates into a decrease of some $140 million across a fleet of 10,000 trucks.
“A lot of these fleets are upside down at the time of trade. It’s forcing companies to keep their equipment longer,” said Trevor Pasmann, corporate used-truck manager at Kenworth Sales Co., a commercial-truck dealer based outside Salt Lake City.
Some carriers that expanded their fleets now are cutting the number of trucks they run. That feeds more vehicles into the market and works to keep used-truck values down. 
Last month, Ryder System Inc.,  a commercial-truck operator with a large leasing and commercial-rental division, reported first-quarter earnings fell 32% from a year earlier. The company blamed in part the soft used-vehicle market, as well as weaker-than-expected demand for commercial-vehicle rentals.
While used-vehicle prices are showing signs of bottoming out, the supply of used big rigs is expected to remain substantial into 2020, said Chris Visser, senior commercial-truck analyst at J.D. Power. If freight demand fails to improve, he said, pricing will remain depressed.
As vehicle prices fell, some trucking companies adjusted their books to reflect lower resale values for their equipment. Carriers that were making money during the boom by trading in used vehicles found themselves ringing up smaller gains on the sale of those assets.
For many publicly traded carriers, those hits to the bottom line represented “the biggest [such] headwinds in more than 20 years,” according to a February research note from transportation analysts at Stephens Inc., an investment bank and private-equity firm. 
On May 1, Celadon said it had hired Stephens as an adviser and its chief operating officer had resigned, amid an examination by the company’s audit committee of transactions involving the purchase and sale of equipment between June and December of 2016. Celadon’s auditor, BKD LLP, has withdrawn its reports for fiscal 2016, which ended June 30, and the two subsequent quarters. Celadon has been accused by two short sellers, Prescience Point Research Group and Jay Yoon, of attempting to hide mounting losses tied to its bet on the truck resale market. Celadon, through a spokesman, declined to comment. 
By Jennifer Smith - Wall Street Journal 

Thursday, January 5, 2017

China Set to Rescue Australia Economy at Just the Right Time

And they have rescued it for 20 years so far... Aivars Lode
The news out of Australia isn’t all gloom.
By Michael Heath
While growth figures stank last quarter, the nation is again being cushioned by its status as the developed world’s most China-dependent economy. Surging coal and iron ore prices have helped ease an erosion of national income Down Under and, together with a slower slide in mining investment, signal better prospects ahead.
Australia can thank its No. 1 trading partner, whose old economy is reviving as fiscal stimulus gets smokestacks billowing again. Traditional Chinese industries seen as proxies for growth, such as electricity and rail cargo, have collectively bounced back to the highest level in three years. The big unknown: the durability of a turnaround that’s ended a more than 50 percent drop in commodity prices between 2011 and 2016.
“This story is a big one for Australia,” said Paul Bloxham, chief Australia economist at HSBC Holdings Plc, who previously worked at the nation’s central bank. “We’ve talked about the commodity price rise as being a game-changer.”
Bloxham says the extended price slump since 2011 brought investment in new mines to a halt and as a result commodities have passed their trough. He estimates the rebound, which has seen coking coal prices rise 280 percent this year, could add about 2 percentage points to nominal gross domestic product Down Under.
Macquarie Bank Ltd. predicts Australia’s terms of trade -- export prices relative to import prices -- will climb 7 percent next year. That will help lift nominal GDP growth to more than 5 percent, which would be the best result since 2011, said James McIntyre, head of economic research in Sydney.
But this “boom” is different. While a big winner should be government revenue as higher prices boost the profits of mining companies and the taxes they pay, weaker wage growth may cancel out that benefit.

High Hopes?

Aussies probably shouldn’t bet on fatter wallets either. In the previous boom, governments recycled cash back to citizens through tax cuts, higher benefit payments and increased fiscal spending to “turbo-charge” the economy.
“That’s not going to happen this time,” said McIntyre. “Any extra revenues will help offset areas of weakness for the budget like underemployment and low wages growth; every additional dollar over that is likely to go into budget repair. Those hoping for a redux of the 2000s boom are likely to be disappointed.”
The Liberal-National coalition government is wary of incorporating higher coal and iron ore prices into its forecasts after its Labor party predecessors were burned by excessive optimism. With Australia battling to maintain its AAA credit rating and Treasurer Scott Morrison aiming to return to a balanced budget by fiscal year 2021, it could be tempting.
“We’re not forecasting it in,” Trade Minister Steven Ciobo said in an interview Thursday in Jakarta. “Treasury has made not a forecast but an assumption with respect to commodity prices. Obviously, the stronger commodity prices are, the better that that is for Australia. We’ve never pretended otherwise.”
Where the commodity spike has been showing up is in Australia’s trade balance. The monthly deficit, which blew out to A$4.2 billion ($3.1 billion) in December, has been rapidly narrowing and was just under A$1.3 billion in September. 
Data out Thursday showed the deficit subsequently widened to A$1.5 billion in October, compared with economists’ forecasts for a A$610 million gap. Deutsche Bank AG analysts suggested a lag between spot and contract prices for commodities; on top of that, almost A$500 million of capital goods were imported in the month.
The deficit is still expected to narrow as the data more fully reflects coal’s surge. So Ciobo may yet oversee a trade surplus, a rarity for any minister that’s held the post.
That would prove welcome news for the government after data Wednesday showed the economy shrank in the three months through September by 0.5 percent, only the fourth quarterly contraction in the past 25 years. Economists surveyed by Bloomberg forecast an expansion this quarter of 0.6 percent.
Even if China eases stimulus, its decision to shutter excess capacity in the coal industry may continue to aid Australia, while U.S. President-elect Donald Trump’s infrastructure investment push could also provide additional support to commodities.
Exports “are a key driver of the growth story in Australia and in many respects the GDP number just reinforces the value that exports will have,” said Ciobo. “But look, it’s a volatile time. And so export growth is going to continue to be a key driver for our economy for some time.”

Monday, June 13, 2016

Apple tax disclosure: 2016 will be a defining moment for ending the multinational tax rort

Just because you spent a fortune on setting up overseas tax ministration structure does not mean that you won't end up paying it. Aivars Lode

By Heath Aston

Apple is one of many tech companies accused of shifting its Australian profits to places such as Ireland. 
Imagine the extra cream left in the jug of the household budget if we all paid an income tax rate of one cent in the dollar.
So how does Apple justify such a laughably low profit margin in Australia? 
Holidays on luxury yachts would no longer be the preserve of rap stars, investment bankers and the founders of Silicon Valley start-ups.
Chief executives and their advisers will tell you that understanding a multinational company's tax bill is far too complex for mere mortals.
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It is not. And the numbers don't lie.
Apple's offering to the Australian tax man in 2015 was $85 million. In the same year, the company notched local sales of $8 billion. Of course, company tax is paid on profit not sales. Apple announced an Australian profit on those $8 billion of sales of just $123 million.
If you believe that is Apple's actual profit margin on products sold in Australia, step this way and start queuing for the iPhone 7. It washes the dishes and walks the dog and I can get you one cheap.
On Wednesday morning, Apple released its global profit statement. It was a far more plausible $US18.4 billion net profit on sales of $US75.9 billion.
So how does Apple justify such a laughably low profit margin in Australia?
With the same excuse used by all the big multinational companies, from its rival Google to the big pharmaceutical groups and the oil and gas giants: related party transactions.
These can include loans from a separate division of the company based in a low-tax country that come with punishing interest rates. They can also be steeply-priced intellectual property charges that the Australian arm is asked to pay another division.
In Apple's and Google's cases the process has been referred to as the "double Irish Dutch sandwich" but, whatever the means, the end result is a flow of funds out of Australia, severely limiting the profit that is left behind to be taxed. It is not rocket science.
The next 12 months will be the defining moment in forcing multinationals to at last pay a fair share in Australia.
The Coalition's multinational tax-avoidance law took effect on January 1 and will target 1000 companies with global sales of $1 billion or more.
Under the law, companies can be slapped with double tax, plus interest, if found to be illegally shifting profits offshore.
The carrot effect in encouraging companies to sit down and negotiate a more reasonable tax contribution is already working, according to Tax Commissioner Chris Jordan.
In Britain, the first OECD country to introduce a diverted profits law, Google this week offered $265 million in back-taxes as a token contribution to signify its acceptance of the new playing field there.
But if anyone thinks all 1000 multinationals will meekly start paying 30¢ in the dollar, you might also want to buy my iPhone 7.
Even after their humiliating grilling by the Senate's tax avoidance committee, the tech companies have maintained their implausibly low profit margins in Australia this year.
Those companies are known for the kind of agility lauded by Malcolm Turnbull.
Unfortunately, it is their agile approach to tax minimisation that is putting pressure on the Prime Minister's budget bottom line and making it more likely we will all be paying a higher GST on everything - including the next model of iPhone.

Yahoo to Cut 15% of Workforce, Explore Strategic Options

Tough times for old internet firms, lucky Alibaba. Aivars Lode
By Douglas Macmillan and Dana Mattioli
Yahoo Inc. has effectively hung a for-sale sign on its Web properties, signaling the possible end of a 20-year run by an Internet icon.
The company on Tuesday said it would explore “strategic alternatives” as part of a restructuring that will eliminate roughly 15% of its workforce. The announcement came alongside a dismal fourth-quarter report card in which Yahoo took a $4.5 billion charge to write down the value of businesses including its Tumblr blogging site.
Yahoo’s move to mull its options, confirming a report earlier Tuesday by The Wall Street Journal, sets the stage for a possible bidding war between a wide range of potential buyers. About 1 billion people a month travel collectively to Yahoo’s home page, email and other sites, making them an attractive asset to media conglomerates such as Wall Street Journal owner News Corp and IAC/InterActiveCorptelecom giants including Verizon Communications Inc. and private-equity firm TPG—all of which have expressed interest in purchasing parts or all of the business, people familiar with the matter said.
Yahoo’s next step may be to initiate a formal sale process, which entails setting up a virtual data room detailing the company’s business metrics, and proactively reaching out to the most likely potential buyers. Or the board could choose to wait until a suitor approaches them with an offer, at which point it would weigh that against any counteroffers.
Estimating the value of Yahoo’s business is difficult, because investors ascribe a large portion of its roughly $27 billion market value to its stakes in Alibaba Group Holding Ltd. and Yahoo JapanBrian Wieser, an analyst at Pivotal Research LLC, estimates Yahoo’s core business, excluding the Asian assets and its cash, is worth around $3.4 billion. 
A sale process would also likely mark the end of Chief Executive Marissa Mayer’s attempt to turn around Yahoo. Costs have risen, while revenue has shrunk in the 3½ years since she took the reins. Fourth-quarter revenue excluding commissions paid to retail partners was about $1 billion, down 15% from a year ago and the lowest point during Ms. Mayer’s tenure.
Her efforts were complicated in recent months by an exodus of top managers and growing impatience from investors, including hedge-fund activist Starboard Value LP, who has called for new leadership and a sale of the company.
In an interview, Ms. Mayer said she was confident a turnaround could still be accomplished. “I’m very much looking forward to the turnaround plan that I have presented today, and I think it will make us the best version of ourselves,” she said.
Three years ago, Ms. Mayer said she planned to return Yahoo to a growth rate on par with competing Internet companies such as Google Inc. and Facebook Inc. The new plan represents a more realistic vision for turning around the business, she said.
“I probably now understand more of what the necessary steps and ingredients are and have a bit more realism in terms of how quickly they can be at companies as large as Yahoo,” Ms. Mayer said.
Yahoo’s plan did little to appease some shareholders including SpringOwl Asset Management LLC, which in December recommended the company cut up to 75% of staff and bring in a more operations-focused CEO.
“This is a company that has clearly suffered from a lack of focus,” said Eric Jackson, managing director at SpringOwl. “We believe there is much more that needs to be done to improve the profitability of the business.”
Investors have until March 26 to submit proxy proposals. Prior to Tuesday’s announcement, Starboard has indicated it would nominate a slate of new directors. The investor didn’t respond to a request for comment. 
At the moment, Yahoo is focusing on trimming costs to make it more attractive to investors or buyers. Yahoo said that by the end of 2016, it anticipates having about 9,000 employees and fewer than 1,000 contractors, which represents a workforce that is roughly 42% smaller than it was in 2012. The company sees the cuts resulting in savings of $400 million a year.
In a call with analysts on Tuesday, Ms. Mayer said the restructuring would help Yahoo improve its focus on three key areas: search, communications and digital content.
“We will simplify the business to improve execution,” Ms. Mayer said on the call. “Yahoo cannot win the hearts and minds of users and advertisers with a complex portfolio of assets.”
Ms. Mayer is also betting Yahoo can make headway in mobile search, even though the company has failed to gain any ground in Web search from Google and Facebook. Yahoo has been working on a search engine tailored to mobile phones that can help people quickly find their personal information or the right apps, people familiar with the matter have said. “We really think mobile search needs a much deeper reimagination,” Ms. Mayer said Tuesday.
In the meantime, Yahoo also said it has begun to explore divesting itself of nonstrategic assets, such as patents, the sale of real estate, and other noncore assets. Through the end of the year, the company estimated that these efforts could generate between $1 billion and $3 billion in cash.
“The board also believes that exploring additional strategic alternatives, in parallel to the execution of the management plan, is in the best interest of our shareholders,” Yahoo Chairman Maynard Webb said in a news release. That represents a broadening in stance from December, when Mr. Webb said the company wasn’t interested in a sale but would entertain offers as part of the board’s fiduciary duty.
Yahoo also said Tuesday that finance-industry entrepreneur Charles Schwab is resigning from its board. Mr. Schwab was among the seasoned executives Ms. Mayer added to the board as she put her own stamp on its governance.
Mr. Schwab, whose departure will leave the Yahoo board with seven directors, pointed to his other professional commitments and demands on his time and said his departure wasn’t related to any disagreement with the company.
Shares of Yahoo, down 35% over the past year, fell 1.2% to $28.72 in after-hours trading.
Yahoo reiterated Tuesday that it will continue exploring a separation of its operating business from its stake in Alibaba. “I do feel comfortable we can do it this year,” Chief Financial Officer Ken Goldman said on the earnings call.

Foxconn Puts $5.5 Billion Sharp Takeover Bid on Fast Track

Further shakeouts in the technology space. Aivars Lode
By Takashi Mochizuki, Eric Pfanner, and Wayne Ma
TOKYO—Taiwanese iPhone assembler Foxconn is pushing to wrap up a takeover of Sharp Corp. within days, people familiar with the situation said Thursday, after the Japanese electronics company said it favored Foxconn’s offer over a government-backed bailout.
Sharp’s embrace of Foxconn marked a striking turnabout in a battle that has come to be seen as a test of Japan’s openness to foreign investment and highlighted the role of its government in restructuring a troubled electronics industry.
Until this week, a government-backed fund, Innovation Network Corp. of Japan, appeared to have the inside track toward a deal with Sharp, even though people familiar with the situation said Foxconn’s $5 billion-plus bid was worth more than twice as much.
But Sharp Chief Executive Kozo Takahashi said Thursday that the company would focus its attention on the talks with Foxconn, without shutting out INCJ entirely.
“The two offers are not equal,” he said. He cited potential synergies and the scale of Foxconn, which has $125 billion in annual sales. It is the largest assembler of Apple Inc. smartphones, making them and a range of other electronics devices at sprawling factories in China.
Foxconn Chairman Terry Gou was traveling Thursday to meet with Sharp officials at the company’s headquarters in Osaka, a person familiar with the situation said. Mr. Gou offered Sharp a ¥200 billion ($1.7 billion) deposit, and lawyers for the two companies were hashing out other details, the person added.
Prime Minister Shinzo Abe has urged Japan to put out a welcome mat to foreign investors, but deals have been scarce. Japanese firms, on the other hand, are pushing overseas aggressively to seek growth beyond a stagnant domestic market. The value of outbound deals has outweighed inbound acquisitions by nearly four to one over the past two years, according to research firm Dealogic.
Sharp’s tilt toward Foxconn “shows that Japan is open to foreign capital,” said Nicholas Benes, a Tokyo-based corporate governance expert. “The government must have realized that this was going to be viewed as a bellwether deal for Abenomics,” as Mr. Abe’s plan to revive Japan’s economy is known.
INCJ, which describes its role as fostering technological innovation and globalization, has helped to keep foreign suitors at bay by taking part in several rescues of troubled Japanese tech firms, including smartphone-panel maker Japan Display Inc. and chip maker Renesas Electronics Corp.
INCJ is also working with Toshiba Corp. in its restructuring, according to people familiar with the matter. Toshiba, which on Thursday forecast a record annual loss of ¥710 billion after a drawn-out accounting scandal, has said it plans to sell its medical-device unit and possibly other divisions.
Should Foxconn succeed in coming from behind to seal a deal, it faces an equally tough challenge: turning around a company suffering from years of decline in its consumer-electronics business and a plunge in prices of the liquid crystal display panels it provides to Apple and other smartphone makers.
On Thursday, Sharp said its net loss in the three months through December more than doubled from a year earlier, to ¥25 billion. Revenue dropped 13%. The company faces a March 31 deadline to repay lenders who have already bailed out the company twice in less than four years.
Sharp’s shares surged 17% on news of its shift toward Foxconn.
Mr. Gou’s pursuit of Sharp goes back to 2012, when he initially reached a deal for Foxconn to take a 10% stake in the Japanese company. The deal unraveled the next year after dismal earnings sent Sharp’s shares plunging.
That history made some Sharp executives reluctant to work with Mr. Gou again, according to people familiar with their thinking. Even after Thursday’s developments, it is possible the two sides could fail to reach a final agreement.
One person briefed on the talks said Sharp’s lenders pressed the company to take a closer look at the Foxconn offer after Mr. Gou traveled to Japan last week to make a personal appeal for a raised bid worth ¥659 billion, according to people familiar with the matter. That compared with an offer from INCJ that was worth no more than ¥300 billion, the people said.
In his presentation, Mr. Gou said Foxconn wouldn’t cut Sharp’s workforce, people familiar with the situation said. Sharp’s lenders believed the larger investment from Foxconn, formally known as Hon Hai Precision Industry Co., would give Sharp a better chance to grow, these people said.

Mr. Takahashi said Sharp and Foxconn had “built a relationship of mutual trust” via an existing partnership called Sakai Display Products.
People familiar with the situation said Sharp was keeping INCJ in the picture as a second option in case the talks with Foxconn fall through.
Foxconn didn’t respond immediately to a request for comment. INCJ said it would continue talks with Sharp. 
Sharp’s CEO said a deal with Foxconn could benefit Sharp’s production, sales and materials-procurement operations. He said he would work to prevent a breakup of Sharp, which makes everything from televisions to air purifiers to solar panels, and had no plans at this point to step down.
He also raised the prospect of an alliance with Japan Display Inc., the country’s other major producer of smartphone-display panels. Until now, Japan Display and Sharp, each of which supplies Apple with mobile-device screens, have operated at arm’s length.
For now, the prospect of reviving Sharp appears to outweigh previous concerns at the company and among some Japanese policy makers that the country’s technology might leak overseas.
“It’s no use having that technology if the company is going under,” said Hideyuki Ishiguro, senior strategist at Okasan Securities.

Tech Stocks: Why the Selloff Could Get Worse

Tough sledding. Aivars Lode
By Dan Gallagher and Justin Lahart
Dark clouds have descended on the tech sector. And while Punxsutawney Phil may say otherwise, a break may not be soon in coming.
A bruising selloff since the first of the year has cost the Nasdaq Composite all of its gains since late 2014, with the pain particularly acute in the riskier Internet and software sectors. The index is off 14% so far this year. The Nasdaq Internet Index has fallen 21%, and cloud stocks tracked by the BVP Cloud Index are off more than 31%. By contrast, the Dow Jones Industrial Average is off a more modest (even if still painful) 8%. 
The selloff reflects an unsettled global economic and financial-market environment that is hitting tech stocks on three fronts.
First, in an era when U.S. companies at large have become steadily more dependent on their foreign operations for sales, tech companies’ overseas exposures stand out. Hewlett-Packard, for example, generates only about a third of its sales in the U.S, while Intel books less than a fifth of its sales domestically. As a result, many tech companies are taking unusually hard hits from economic weakness abroad. The dollar’s strength against other currencies—the greenback averaged 12% higher on the year on a trade-weighted basis versus other currencies in the fourth quarter—has made a bad situation even worse.
Second, worries about the global economic environment have prompted many companies to rein in capital spending and other investments. This can hurt the flow of new deals that is the lifeblood of software companies that sell cloud-based services. Tableau Software trimmed its full-year forecast last week, citing “softness” in business-tech spending. That sparked a huge selloff that cut Tableau’s market value by more than half and badly damaged many peers. Salesforce.com, Workday and Splunk—which will report results later this month—are off more than 20% in just the past two sessions.
Finally, there is the issue of price. Most cloud and Internet companies carry lofty valuations. Amazon.com is still more than 100 times forward earnings despite losing nearly 30% of its value since the first of the year. The Nasdaq Composite still carries a premium of nearly 24% to the S&P 500 on the same basis.
Now, the benign economic environment those valuations were predicated on has been put into question, while a global flight to safety has pushed investors away from risky bets.
With the tech sector’s earnings season still in full swing, it is possible that pending reports could help turn the tide for the sector. Cisco Systems is slated to report Wednesday, and that company often serves as a barometer for corporate-technology demand.
The problem is, tech’s earnings reports have actually gone pretty well so far, relative to reduced expectations. But that hasn’t stanched the bleeding.
About 65% of reporting tech companies have also exceeded analysts’ revenue targets, compared with 49% for the S&P. Not that it has done them much good: Microsoft and Google are down 11% and 12%, respectively, since their relatively strong reports.
In the changed market environment, the tech sector has caught a sudden chill. Spring, especially for companies with little in the way of profit, will be a long time in coming.

Unicorn fever cools as deal terms toughen

Trouble in the unicorn world. Are valuations artificially being kept high by staying private? Aivars Lode

By Mark Boslet

Private company investors showed an abrupt caution for unicorn financings in the fourth quarter of last year with average valuations plunging and the use of tough deal terms on the rise.
A Fenwick & West survey of most, if not all, unicorn deals from the final nine months of 2015 uncovered a big drop in the fourth-quarter appetite of VCs and non-traditional investors to reward entrepreneurs with big mark-ups and eye-popping company valuations.
The study is the latest piece of evidence to point to a cooling of interest in so-called unicorn deal making as venture capitalists reassess exactly what their startups are worth.
In contrast to a prior study covering most of 2014 and the first quarter of 2015, the average valuation of unicorn financings in the fourth quarter was $1.6 billion. This is down from $4.1 billion in the third quarter and $5.6 billion in the second quarter.
Worth noting is that half of the Q4 deals came in with valuations of between $1 billion and $1.1 billion, or just enough for each of the companies to win the moniker of a being unicorn as they crossed the $1 billion threshold.
As a result, the average mark up over a company’s Series A round was a third or less than what it was earlier in the year. The average per share price increase over an A round was 2,081 percent in the fourth quarter compared with 6,291 percent in the third quarter, the study found.
The use of investor friendly terms also jumped. Senior liquidation preferences were far more common and the use of IPO protections increased. A third of deals had blocking rights, keeping a unicorn investor’s shares from automatically converting into common stock at an IPO unless the IPO price meets a certain level.
Ratchets giving investors extra shares if an IPO price falls below that of the unicorn round also were more frequent. They turned up in 17 percent of fourth quarter deals, the study found.
Non-traditional investors led 84 percent of unicorn deals in the final nine months of last year and the average deal size was $222 million.