Summary of Hudson Global and STAR Equity Holdings Merger Announcement Conference Call Industry and Companies Involved - **Companies**: Hudson Global (HSON) and STAR Equity Holdings (STRR) - **Industry**: Mergers and Acquisitions, Staffing and Recruitment Services Core Points and Arguments 1. **Merger Announcement**: Hudson and STAR signed a definitive merger agreement, marking a significant milestone for both companies [4] 2. **Transaction Structure**: STAR will merge into a wholly owned subsidiary of Hudson, with STAR shareholders receiving 0.23 shares of HSON for each STAR share held [5] 3. **Ownership Post-Merger**: Upon completion, Hudson shareholders will own approximately 79% of the new company (NewCo), while STAR shareholders will own about 21% [5] 4. **Financial Projections**: The merger is expected to create a larger holding company with pro forma annualized revenue exceeding $200 million and anticipated annualized cost savings of at least $2 million within 12 months [6] 5. **Growth Goals**: NewCo aims to reach $40 million in adjusted EBITDA by February 2030, based solely on organic growth [7] 6. **Operational Segments**: NewCo will consist of four reporting segments: Building Solutions, Business Services, Energy Services, and Investments [7] 7. **Strategic Advantages**: The merger is expected to enhance stock trading liquidity, market capitalization, and provide better financing terms for acquisitions [6][9] 8. **Management Structure**: The management team from both companies will lead NewCo, maintaining a decentralized operating model and a value-oriented acquisition strategy [10] Additional Important Information 1. **Regulatory Approval**: The merger is pending regulatory and shareholder approvals, anticipated to close in the second half of 2025 [6] 2. **Cost Savings Details**: Identified cost savings will come from eliminating duplicative functions, such as audits and public company costs [14][15] 3. **NOL Utilization**: NewCo will benefit from Hudson's substantial net operating losses (NOL), which will be utilized to offset taxable income [17] 4. **Market Positioning**: The merger aims to break out of "microcap purgatory," enhancing the visibility and liquidity of both companies in the market [55] 5. **Shareholder Vote**: A majority vote from both companies' shareholders is required for the merger to proceed [22][28] 6. **Dividends**: STAR's preferred stock will continue to pay dividends post-merger, with no changes to the terms [60] 7. **Future Growth Strategy**: Both companies plan to pursue organic growth and bolt-on acquisitions to enhance their market positions [37][39] This summary encapsulates the key points discussed during the conference call regarding the merger between Hudson Global and STAR Equity Holdings, highlighting the strategic rationale, expected benefits, and operational plans for the newly formed entity.

Financial Data and Key Metrics Changes - Cannae's total operating revenue for Q1 2025 was $103 million, a 7% decrease from the prior year due to lower restaurant revenue [23] - The company reported net recognized gains of $7 million in Q1 2025, compared to $5 million in the prior year [27] - Cannae's equity in earnings and losses of unconsolidated affiliates posted a $2 million net loss in Q1 2025, compared to an $18 million gain in the prior year [28] Business Line Data and Key Metrics Changes - CNB reported revenue of $580 million, representing 3.6% constant currency organic growth compared to the prior year's first quarter [13] - Alight reported total revenue from continuing operations of $548 million for Q1 2025, a 2% decrease from the prior year [14] - Adjusted EBITDA for Alight was $118 million, a $2 million increase compared to the prior year [14] Market Data and Key Metrics Changes - Cannae's largest public investment, Dun and Bradstreet, is being acquired for $4.1 billion, from which Cannae will receive $632 million upon closing [7][9] - The company expects to utilize approximately $730 million from public portfolio sales for shareholder returns and debt repayment [10] Company Strategy and Development Direction - Cannae is focused on rebalancing its portfolio away from public investments and investing in companies with positive cash flows [7] - The company aims to return capital to shareholders and improve operational performance of its portfolio companies [7] - Cannae announced an agreement to acquire an additional 30% stake in JANNA Partners for $67.5 million, enhancing its ability to allocate capital towards proprietary acquisitions [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strategic relationship with JANNA Partners and the potential for future investments [32] - The company believes there remains significant embedded value in its portfolio and upside in stock price as it executes its strategic plan [50] Other Important Information - Cannae appointed Bill Royan and Woody Tyler to its board, both bringing strong investment management experience [12] - The company is undergoing significant changes in its Restaurant Group, including management restructuring and cost-cutting measures [26] Q&A Session Summary Question: Can you discuss the revenue and earnings profile of JANNA Partners? - Management indicated that JANNA has significantly higher assets under management than initially invested, exceeding $2 billion, and is performing well financially [31][32] Question: Are there plans to increase ownership in JANNA Partners? - Currently, there are no plans to increase ownership percentage as the existing structure is deemed effective [35] Question: Can you elaborate on the Vitality Stadium acquisition? - Management believes the redevelopment of the stadium is financially attractive, projecting mid-teens returns on the investment [42][43] Question: How does Cannae plan to deploy incremental capital for M&A? - In the short term, the focus will be on returning capital to shareholders, but the company remains open to opportunistic investments that can deliver attractive returns [46][47]

Financial Data and Key Metrics Changes - In Q1 2025, total GAAP revenue was $36.3 million, up more than 7% from $33.9 million in the prior quarter and nearly 4% from $34.9 million in Q1 2024 [24] - GAAP net income totaled $5.2 million or $0.25 per diluted share, an increase from $4.2 million or $0.21 per diluted share in 2024 [23] - Adjusted EBITDA reached $8.2 million, reflecting a nearly 9% increase from the same quarter in 2024 [29] Business Line Data and Key Metrics Changes - Software revenue was $17.8 million, up 9.2% from the prior year quarter, while wireless revenue was $18.5 million, nearly flat compared to Q1 2024 [24] - Professional services revenue increased by nearly 44% year over year, totaling $5.8 million, with managed services revenue accounting for $1.3 million, up more than 180% from $500,000 in Q1 2024 [27] - Software backlog increased by more than 15% year over year, indicating strong future revenue potential [9] Market Data and Key Metrics Changes - The average revenue per unit (ARPU) for wireless services increased by 4.4% year over year to $824, driven by prior pricing actions and sales of new products [24] - Net unit churn improved to 6.4% from 7.2% in the prior year, reflecting better customer retention [24] Company Strategy and Development Direction - The company aims to generate cash and return capital to shareholders while investing in growth, maintaining a disciplined expense management approach [5][12] - The strategic focus includes continued investment in wireless and software solutions, growing the revenue base, and a stockholder-friendly capital allocation plan [12] - The company has transformed into a leading healthcare communications provider, emphasizing its commitment to enhancing patient care and safety through technology [13][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance despite macroeconomic uncertainties, reiterating guidance for 2025 [16][31] - The company anticipates annual free cash flow in the range of $24 to $28 million and expects to exit 2025 with cash balances between $23 million and $27 million [30] - Management highlighted a strong start to 2025, with expectations for continued growth driven by software solutions and a solid customer base [33] Other Important Information - The company has maintained a strong reputation in the healthcare communications industry, recognized as a top clinical communications platform for eight of the past ten years [15] - The HIMSS conference experience was positive, with a focus on prequalifying meetings leading to better engagement and interest in new products [48][50] Q&A Session Summary Question: Is there any seasonality with the larger 7 figure contracts? - Management noted no seasonality observed, with a positive trend in contract signings [38] Question: What drove the strong wireless product revenue? - The increase was primarily due to a pricing initiative for unreturned pagers, expected to yield an annualized benefit of about $1 million [40] Question: What drove the improvement in gross margin? - Gross margin improved due to strong revenue performance, though fluctuations may occur based on quarterly results [41][42] Question: What is the conversion timeline for the software backlog? - Approximately half of the backlog is services, with maintenance revenue typically recognized over a year and services over nine to fifteen months [43][44] Question: How was the experience at the HIMSS conference? - The conference was better than the previous year, with a focused approach leading to successful customer engagements [48][50] Question: What is the strategy for managed services? - Managed services provide fixed costs for customers, aiding in revenue recognition and reducing churn [52][53] Question: Are the new logos significant customers? - Both new logos are meaningful wins, with the company having pursued them for some time [56][59]