Read Online The Bancroft Strategy by Robert Ludlum - Free Book Online Page A

one-point-four-billion-dollar question, isn’t it?” Andrea said. She hoped she was not coming across as cheeky. “Let me show you something.” She projected a slide showing revenue intake,then superimposed another slide showing the number of customers acquired over the same period. “These figures ought to be in a tandem harness. But they’re not. They’re both rising, yes. Only, they’re not rising together . When one zags down in a quarter, the other might zag up. They’re independent variables.”
    â€œJesus,” Brook said. She could tell from his crestfallen expression that he got it. “They’re shamming, aren’t they?”
    â€œPretty much. The acquisition cost per household is killing them, because the service is so deeply discounted for new customers and nobody wants to renew at the higher rate. So what they’ve done is run two flattering figures up the flagpole: customer growth rates and revenue growth rate. Assumption is, we’re going to look at the big picture and see cause and effect. But the revenue is smoke and mirrors, ginned up by equity swaps, and by hiding the money they’re losing on growing the customer base through all these supposed onetime charges.”
    â€œI can’t believe it,” Brook said, slapping his forehead.
    â€œBelieve it. That debt is a big bad wolf. They just put it in a dress and a bonnet.”
    Pete Brook turned to Bradley. “And they had you saying, ‘What lovely big teeth you have, Grandma.’”
    Bradley fixed Andrea Bancroft with a stern gaze. “You sure about this, Miss Bancroft?”
    â€œAfraid so,” she said. “You know, I used to do history, right? So I figured the history of the company might shed some light on things. I looked way back, back before the DyneCom merger. Even then, the CEO had a habit of robbing Peter to pay Paul. New bottle, old wine. MagnoCom has a business plan from hell, but the financial engineers they hired are pretty brilliant, in a twisted way.”
    â€œWell, let me tell you something,” Bradley said in a level voice. “Those pissers met their match. You just saved my goddamn ass, not to mention the firm’s bottom line.” He grinned and startedapplauding, having calculated that a quick surrender to the winning argument was the better part of valor.
    â€œIt would have all come out on the Form Eight-K,” Andrea said as she gathered her papers and started to walk back to her seat.
    â€œYeah, after the deal was inked,” Brook interjected. “Okay, ladies and germs, what have we learned today?” He looked around at the others in the room.
    â€œGet Andrea to perform your due diligence,” one of the traders said with a snort.
    â€œIt’s easy to lose money in cable,” another one cracked.
    â€œGive it up to Bangin’ Bancroft,” called out another would-be wit, this one a more senior analyst who hadn’t caught the flimflam in his first pass through the PIPE proposal.
    As the meeting started to break up, Brook came over to her. “Solid work, Andrea,” he said. “More than solid. You’ve got a rare talent. You look at a stack of documents that looks completely in order, and you know when something’s off.”
    â€œI didn’t know —”
    â€œYou sensed it. Then, even better, you worked your ass off to prove it. There was a lot of ditch-digging behind that presentation. I bet your spade banged against bedrock more than once. But you kept digging, because you knew you’d find something.” The tone was of assessment as much as commendation.
    â€œSomething like that,” Andrea admitted, tingling slightly.
    â€œYou’re the real deal, Andrea. I can always tell.”
    As he turned to speak to one of the portfolio managers, one of the secretaries approached her, clearing her throat. “Miss Bancroft,” she said. “A call you might