Terminal Value (2 page)

Tony immediately saw why Williams must have selected the word “Mantric.” It was the adjective form of mantra, and so was meant to suggest that the company had mystical powers. Tony, of course, had been the one to come up with MobiCelus, though he initially wanted to call the company MobiCelu$—or so he'd said. He recalled the name had elicited groans from the partners. “It's still just so fucking unbelievable,” Tony said now. “Jeez, to think we could be doing really cool stuff and rolling in the green before we're even thirty.”

“Yeah, and we haven't even suffered yet,” Heather grinned.

Mantric, which specialized in using cloud computing and other web-based technologies to run systems for major corporations, was said to be planning an initial public offering. Rumor had it Mantric would float its IPO within the year.

“So here's the deal,” Dylan resumed. “Besides access to their kick-ass resources and technology, we're talking an incredible upside opportunity with the stock. Based on what Art told me about Mantric's growth and comparing the company to its public counterparts, I think the stock could be worth forty to fifty dollars a share within eighteen months. And who knows how much higher it'll go after that?”

“So you're saying, Dylan, that the deal, all told, could be worth maybe seventeen million dollars, or even more?” Rob spoke without looking up from his calculator.

“That's right. No guarantees, of course, but even a worst-case scenario winds up being pretty impressive. Let's say the stock ends up being worth just thirty dollars a share. That's nine million dollars, plus we get some cash up front.” Dylan let the numbers sink in for a moment. “So what do you all think?”

“Are you crazy?” Tony yelled, raising his hands in the air. “What's to think about? We get to do the coolest work in the world and we're going to be rich!”

“Heather? Any thoughts?”

“I like this deal. I could design some great stuff with more resources. And the cash alone comes to almost half a million, up front, for each of us—right?”

“It's 400,000 dollars before taxes for the three of us,” Rob quickly interjected, “and 800,000 dollars for Dylan,” factoring in Dylan's majority stake in MobiCelus. “Anybody wanna bet on where the stock will end up?” Rob's question elicited smiles across the table.

“And if, after the IPO, the 300,000 shares become worth, say, fifty dollars a share,” Heather calculated, picking up on Rob's question. “That's at least another three-point-five million dollars for each of us.”

“Fucking A is what I say!” Tony exploded.

Everyone burst out laughing.

“Then I can assume everyone is in agreement? If that's a go, I'll contact Art and we'll move this forward as quickly as possible,” Dylan said.

Everyone nodded quickly.

Dylan added, “I'm going to go let Rich and Matt know what's going on.”

He left the conference room and smiled as he heard an explosion of laughter behind him. The last comment he heard was Rob making a bet about how quickly Dylan could consummate the deal.

* * *

January 7, 9:30 a.m. Boston

Dylan poked his head around the partially opened door in Rich Linderman's office to see him hunched over a side desk, working his computer with one hand and an old desk calculator with the other. The young man's attention was focused on the current financial status report.

Dylan had hired Rich soon after they launched MobiCelus to run the administrative side of the firm. As it grew and they hired a few more staff people, Rich asked if he could be put in charge of the firm's finances. His partners, particularly Rob, had been concerned about putting him in such an important role, and Dylan thought it would be a stretch, but Rich had proven himself. Sure, he was a bit quirky. But when he cut the operating costs of MobiCelus in his first year by 20 percent, even Rob had to admit he was wrong.

As MobiCelus's controller, Rich did not hold a chair at the conference table unless invited, but Dylan valued Rich's opinion on the financial health of the company. He graduated tenth in his class at Wharton, and Dylan had snapped him up after their first interview. An introvert, Rich dedicated his time at the office to the business of MobiCelus, and Dylan was convinced Rich was one of the lynchpins that kept the others on the straight and narrow. There were never any questions about fuzzy financial reports—every piece of information presented by Rich Linderman could be counted on for its accuracy and reliability.

Dylan coughed in order to get Rich's attention but not startle him. Rich raised his hand, but did not turn around for another fifteen seconds. When he did, he shoved his glasses—which had slid down to the end of his nose—back up toward his forehead, where they perched precariously, ready to slide back down with one errant move.

Rich smiled. “Oh, hi, Dylan. Sorry, I didn't realize it was you. I was working on a touchy problem. What can I do for you?”

Dylan walked over to the desk and sat across from Rich. He noticed Rich had on the very same shirt he had worn the last time he'd seen him. “Just wanted to alert you to something big that's going to be happening in the next few weeks.”

“Would that be the Mantric offer?” Rich asked.

Dylan sat up, startled. “How in the world did you know that? I haven't even accepted the offer yet.”

“Oh, their financial person, Christine something or other, called late Friday and said she was going to want to access our financials. She was pretty vague, but mentioned the offer. Of course, I refused to give her access to anything because I don't know her from Adam—or Eve.” He smiled at his weak attempt at humor.

Dylan stared at the wall behind Rich, wondering why in the world anyone from Mantric would go around him, especially before the offer was even accepted.

“Er, that's what I was working on when you came in.” Rich stumbled over his words. “It was late Friday, and I tried to contact you, but you weren't around. I guess I should have e-mailed you or something. I just figured since I wasn't giving her any information it could wait until today, and then I got tied up this morning in reviewing the financials to make sure everything was okay. I hope I was right in not giving any information out.”

“Oh, yes, absolutely, you were right. Um, did she say she would be calling again?” Dylan asked.

“Yeah, she said she'd get back to me, but didn't say when.”

“Okay, Rich. Do me a favor—if she calls back, direct her to me. Okay?”

“Sure. Hey, this looks like it could really be good for the company and all of us—right?”

Dylan heard some trepidation in Rich's question. “Yeah, it could be just that. Thanks for letting me know about Christine's call.”

He rose to leave, not sure whether to call Art or Christine or just wait. He considered his options as he wandered down the hall to see Matt Smith. Matt was one of MobiCelus's senior consultants, well respected by his peers and clients alike. Matt graduated near the top of his class at Stanford before moving east, and when it came to dealing with problems and sorting out answers, Dylan was comfortable bringing pithy issues to Matt's attention. But this information about Mantric's CFO left him baffled, and he decided not to pursue it with Matt at this time.

Matt's office sparkled with organization. He knew where every file, every document—hell, every paper clip—was located. Dylan walked in and chuckled because he saw a wet ring of coffee on the table just as Matt raised the cup to his lips.

“Hmm. Getting sloppy in your old age?” He pointed to the coffee ring.

Matt quickly wiped it with a napkin. “Oops, sorry ‘bout that,” he said, smiling. “What's up?”

Dylan sat across from him and told him about the pending acquisition, but left out the part about Christine's call to Rich.

“Hey! That's great news. Do you have a date when this will happen?”

Dylan just shook his head. “Not definitely. I'll be calling Art Williams as soon as I get back to my office and start the ball rolling. I just wanted to let everyone know what was in the wind so no one would be blindsided.” Dylan questioned the veracity of his own words.

“This is exciting. To be in on something like this at the very beginning!”

Dylan heard the energy in Matt's voice. “Yes, it is.”

“Then great! I'll look forward to it. Let me know what I can do to help make it a smooth transition.”

Dylan rose to leave. “I'll be sure to do that.” He walked back to his office and sat at the desk, his hand hovering over his computer keyboard. He called Art Williams's private line.

“Art Williams here.”

“Art, Dylan Johnson. I just wanted you to know I spoke with my partners, and we're a ‘go' if you are.”

“Hey, that's great! We'll start to carve out the details. Can I get back to you in the next day or two?”

“Absolutely. And, by the way, my controller tells me your CFO, Christine Rohnmann, called and asked him for our financials. I thought that was a little premature and wondered why she didn't come to me for that information.”

Dylan heard a brief silence before Art responded. “Oh—sorry about that. I don't know what Christine was thinking. I'll be sure to mention to her that in the future she should use better judgment.”

“Thanks. I appreciate that, and I'll look forward to talking with you again soon.”

He released the call just as Rich Linderman came in and approached him. “Dylan, I don't think I mentioned it, but I did say something to Rob about Christine's call. He was the only person here on Friday night, but he seemed to be in a hurry and I don't think he paid much attention to me. And I was a little frazzled by the call.”

Dylan thought for a moment and then asked, “How did Rob respond?”

“Basically, he waved me off. Said he had some place to go. Something about meeting a filly, if that makes any sense. Maybe he had a hot date.”

“Thanks, Rich. Let's just keep this to ourselves. I don't want too many people knowing about this acquisition until it's finalized.”

Rich gave him a thumbs-up sign and nodded, leaving the room as quietly as he had arrived.

Chapter 2

January 7, 10:30 a.m. New York

Art Williams hung up the phone, then dialed Christine's private line. “Christine, what in the hell are you doing, calling MobiCelus's controller? I just got off the phone with Dylan, and he wanted to know why you didn't go through him.”

“Calm down, Art. That snarky little controller refused to give me any info. So no harm, no foul.”

“Christine, don't go rogue on me. MobiCelus has some valuable clients, and we don't want to fuck anything up until this deal is signed and sealed.”

“Okay, okay. When are you going to tell the rest of the staff?”

“No time like the present. I'll gather them in the conference room in thirty minutes. Be there.”

He hung up the phone and called his administrative assistant. “Michelle, gather up the managers and have them meet in the conference room in thirty minutes. I have an announcement, and I want everyone there.”

Thirty minutes later Art and Christine walked into the conference room, where a startled and nervous group of managers gathered around the table, sitting in silence.

“I'll make this short so everyone can get back to work,” Art said. “You may have heard some rumblings about some changes, so let me set you all at ease. Mantric has made an offer to buy MobiCelus. Since you are all surfing the web constantly, I'm sure you know of this company. I've spoken with the CEO, Dylan Johnson, and his team has agreed, in principle, to our offer. We'll be finalizing the contract in the next few weeks, so many of you will be seeing new faces around here. They are Boston-based and will keep a presence in that office—at least for now. Eventually we hope to move all aspects of the company here, but that will not be in our first phase. Some of you will be doing some traveling back and forth over the next few months, so be prepared for that. Any questions?” He scanned the sea of wide eyes staring back at him.

Sandeep Nigam, Chief Technology Officer, slowly raised his hand. “Excuse me, Mr. Williams. Can you tell us how this acquisition will occur with regard to our departments?”

Sandeep was a legend. Born in India, he had attended the prestigious India Institute of Technology. After moving to the U.S., Sandeep quickly established himself as a technology genius and became legendary in technology circles. He was one of the original engineers at Apple, where he made his initial mark before establishing his credentials at Google. Then Art Williams had recruited him to join Mantric. And yet, as smart as he was, Sandeep's lack of self-confidence hindered his growth into other opportunities. He'd climbed to his current position and seemed perfectly happy to remain there, but he was always looking over his shoulder.

“I don't have a lot of details because we haven't finalized them. However, in your case, we will be bringing Tony Caruso into the department. He is currently your counterpart at MobiCelus, and he will be reporting to you. My understanding is that he is brilliant in mobile computing, especially in the design and development of new products, so I'm sure he will be an asset. Any other questions? If not, Christine and I will be filling you in as we bring this down to the wire. Shouldn't be much longer. As you know, we are also working on the IPO, and so you can all expect some very busy months ahead. Thank you for your time.”

Art did not wait for any further questions. He nodded to Christine, who gathered up her papers and rose from the table, not acknowledging anyone.

* * *

Sandeep hurried out of the conference room, close behind Art and Christine, and rushed back to his office. He closed the door and sat at his desk, where he immediately spun around to the side table and opened up his browser.

He Googled “Tony Caruso.” Several hits appeared before him, and he began with the first—a reference to MobiCelus and its officers, with a brief history of the company. The second and third hits displayed papers Tony had published regarding the fallibility of some mobile devices. Sandeep scrolled through five more postings but garnered nothing specific about the man, only that his brilliance would bear watching.