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Cytec Industries Inc. Message Board

  • directdad directdad Apr 25, 2005 9:14 AM Flag

    Exiting the CYRO JV...

    ...seems like a good move.

    Will this change the FO site in any substantial way?

    "This joint venture began in 1976 and has created value for both shareholders. However over the last few years the strategic interest of the partners has changed. The sale of our partnership interest in CYRO enables Cytec to focus greater attention to the growth of our core businesses, while letting our partner devote their resources to the growth of CYRO." said Chairman, President and Chief Executive Officer Mr. David Lilley. "Our relationship as a supplier of high quality intermediate products to CYRO will not change after this transaction is completed and we wish Degussa and all the employees of CYRO well in their future endeavors."

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    • Before calling someone stupid you should buy a clue. Do you understand there are situations where you cannot sell stock that is in your 401K?

    • I believe that os114 had quite a bit of his stock in a 401k, some of it was not able to be moved out of company stock, even after the time period that os114 has described. I am sure that he, like many 401k stock holders want to be invested in the company that they work for. OK, this is not smart investing, but it is also human nature, and not necessarily bad. Employees invested in the company that they work for are interested in its profitability. Read �The Smartest Guys in the Room� for an extreme example of the best and worst of the reasons for encouraging employees to be financially invested in their own company.

    • HOw stupid are you for letting any stock loss accumulate to a 50 percent loss!!! DUHHHHH with a 50 percent loss the stock has to double for you to break even. keep your stops tight 7 percent max and let your wins run.
      Good luck to all!!!!!!!

    • I guess my $53-$55 guesstimate may succumb to market momentum, or who knows what, and be delayed for some time. Having said that, today I could not resist and did indeed put my money where my mouth is. Ownership went from 0 to 1000 in about 25 seconds.
      After 2nd qtr results (or an oversold market corrects) I shall strut just a little or be licking my wounds in the shadows.

    • directdad:

      Yes, I've been watching the board for a long time. I'm still "interested" in Cytec stock, but really wonder why I still have the stock.

      Although I'm not quite as negative as OS114, I agree with a good deal that he says and do not have great confidence in the ability of current Cytec management to do much with the company. The current management are not an exciting or dynamic group of folks. They seem very much like the old Cyanamid management.

    • Beendare4x - you don't quite understand the history of all this. Cytec was spun off as a taxable dividend to the shareholders of Cyanamid. There was no stock offering. They got 1 share of Cytec for each 7 Cyanamid they held. Thus, the intial value was stated as $14, but you could not by stock at that price, there was no "real" stock. It climbed substantially before the average stock junkie could get his hands on it. When Cytec was spun off, the employees stock funds were frozen. They did not want 4,000 unhappy Chemical Group employees dumping their Cyanamid stock. When American Home Products bought Cyanamid months later, they had to un-freeze our plan. We could get into Cytec at $27 at that time.

      Now let's look what Lilley did prior to this UBC debocle.

      From 1997 to 2004 Lilley took $528 million dollars of earnings and re-purchased 16.5 million shares of Cytec. Yes that is 1/2 billion dollars !!!! So instead of 50 million shares there was 33.5 million shares. You would think this would help the EPS and vault the stock to new highs. Did it?

      On April 17,1998, CYT was $58.56. Soon it will drop below $40.

      Lilley could have paid out $10 million in dividends every quarter. That would have been about $1.20 per share. Just think what the stock price would be. Instead he blew it on stock re-purchases that did nothing.

      This UBC thing might work out, but only if UBC folks take control of the company, sell off 1/2 of it.

    • Greenerl2,

      You are another one from the early days of this board. Good to see that you are still interested in Cytec.

      I wouldn't read anything into Cronin's stock sales. He still owns 81,000 shares and seems to have been steadily exercising options and selling them over time. I think that he is just diversifying, as any smart investor should.

    • My guess is lower yet. The stock dropped around $9+/share in the past week or so. Says a lot for giving Lilley a couple mil in compensation last year. Think the company would be much better off to buy him out.

      I didn't see any filings indicating that anyone but Cronin sold stock very recently. Interesting when the CFO drops 15k shares just before the stock drops.

    • Yup, UCB is the biggest single CYT shareholder. They took the biggest hit the past week. It will be interesting to see what pressure UCB exerts on the Cyt board of directors to get the price back up.

      As for their UCB's view of the business, since the sale:

      1) The dollar keeps dropping vs. the euro,

      2) The present value of UCB's 5MM+ shares of CYT have dropped

      ==>so the part of UCB that CYT bought looks more like good deal making by Cytec than savvy selling by UCB.

      But, what does this have to do with anything (anything real, like $/share)? As I have said before, I don't understand what is driving Cytec stock. At least I am not alone...
      (BTW, I will be sorry for referencing GE a couple of posts ago. I satnd by what I said, but feel like I should explain it a bit:

      I applaud GE's "Ecomagination" initiative that was rolled out today. (Although the US will need a real energy policy to kick it off and lower the barriers, despite the doublespeak heard from GE Chief Executive Jeff Immelt today. (and not the "no lobbyist left behind" energy bill currently being considered, which will delay or hinder such initiatives.) My reference was to some old clean-up liabilities that dragged on for many years as the costs and complexity escalated.)

    • Reading the earnings release again, I note that $300,000,000 of the purchase of UCB was via 5,772,857 shares of Cytec stock; implying a value of $51.97/share by those with a pretty good view of the business.

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