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RAIT Financial Trust Message Board

  • lmtrack lmtrack Apr 1, 2013 10:54 AM Flag

    From the most recent proxy on RAS

    Who are the biggest investors in RAIT/RAS?

    ARS VI Investor I, LLC=6,455,150=9.6% (Matthew W. Kaplan)
    BlackRock, Inc.=3,519,528=5.8% (Laurence D. Fink)
    RIMA Senvest Management, L.L.C.=5,495,992=8.3% (Richard Mashaal)

    Between them, the "big three" own 15,470,670 shares, 25.48% of the 60,720,757 common shares outstanding
    (as of March 15, 2013)

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    • Davis, you have said numerous times that the RAS bylaws state that no one group could own more than 8% of RAS ?? I certainly like the fact that activist type investors collectively own 25% of the stock. This should keep Schaefer's feet to the fire in terms of continuing to grow AFFO.

      • 3 Replies to needoptions
      • The bylaws specify that no company except Resource America (the original sponsor of RAS) can own more than 7.5% of the common stock in RAS without the permission of the Board of Directors. The bylaws have teeth in that the board is allowed to nullify any holdings above that level. It may be that it is possible to challenge the bylaws in court, but they exist to preserve RAS REIT status. Last I checked, Resource America had no position in RAS. Indeed, it's not clear who Resource America is from the standpoint of the Bylaws. The sponsor was REXI, but the name Resource America is now associated with RSO.

        There are two potential explanations of the share counts RAS has provided in the proxy statement. The first, and less likely, is that the RAS board has given permission to one of the two holders that are shown with larger than 7.5% stakes to exceed 7.5%. This is probably a more likely statement for ARS VI Investor I, LLC, as it has a seat on the board, but I don't think that ARS VI Investor is actually holding 6.4 Million shares of common, for reasons I'll lay out in the second explanation.

        The second, and more likely, explanation, is that the sharecounts provided include both common shares and prospective shares held in the form of convertible notes (RIMA), Preferred D Shares (ARS), and options (ARS). Those prospective shares count for the purposes of determining that ARS and RIMA count as insider investors from the perspective of the SEC. Blackrock's 5.8% stake in the common would quailify it as an insider too.

        Hope this clarifies things somewhat. We'll be able to see real end of 1Q sharecounts share counts in a month or so as the SEC 1Q institutional filings window starts to close. None owned that many shares of common at the end of 4Q. At that time RIMA remained the largest holder of common stock with 3.5M shares. Blackrock has since taken a larger position.

      • I wasn't aware that a publicly traded company can unilaterally restrict the percentage of ownership. Are you sure that's true?

      • I remember RAS having a maximum # and I'm sure Davis is right about the %..So how do these guys end up over the 8%....

        Based upon Imtrack's number I've got ARS @ 10.6% now and over 9% after the new issue with RIMA just over 9% now and 7.9% after the sale....

        Sentiment: Hold

    • Nary a goyim amongst 'em.

 
RAS
8.075+0.005(+0.06%)12:34 PMEDT

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