What if the stock rises to .50 the value will change and the information in the plan of reorganization will be incorrect. Debtors and bondholders will want their due? I cannot see any of the debt and bondholders accepting less than they can get? I feel that then an attorney will proclaim the facts have changed and nullify the plan? Any thoughts??
easy, as it stands right now, the Plan is The Plan and the waterfall has been established and approved at the confirmation hearing last March. Where this trades is irrelevant to The Plan, unfortunately. As a poster recently pointed out, some of the debt is trading at .70, when the plan values it at .20. This is because on paper, there is still about 1.6B of debt, regardless of whether the debtor and its advisers have been slippery enough to 'hide' any 'value'. Judge Chapman put all the pressure on CJ Brown from Blackstone that his testimony was strong enough for her to rule (in a nutshell). But, as I spoke to another shareholder today, I believe she chose her words very carefully in case this ever came back. If so, Blackstone will be in a world of hurt.
So, where this trades doesn't matter because the debtor has continuously said that commons will get cancelled, and a Plan has been confirmed. However, it has never been consummated. Why that is, is anyone's guess right now without any formal announcements, motions, rulings, etc. For us, we have to be able to "SEE THE FIELD".
BAC has shut down their mortgage servicing unit for distressed mortgages here in NYS. Seems MTB has taken over those $%& mortgages at the same site. This is interesting that BAC would bail out or dump those mortgages. I have to question why they are distancing themselves from them? Also is BAC getting ready to make some agreement with AMBAC? I dont really know yet but am watching ardently. I also note that banks are not happy with any life in AMBAC so expect lots of negativity coming out of that sector towards any change to the AMBAC bk, and of course any common shareholders raising the pps.
The share price has nothing to do with the actual value of the company. The value, in reality probably has changed, but right now the judge has said the value of the company two years ago is what the company is worth. They don't meet the IRS conditions, the POR gets cancelled and we are off and running again. A large bank settlement that puts common in the money and once again we ar5e off and running; otherwise, common is gone and the creditors own the company.
" the value of the company two years ago is what the company is worth."
Obviously false, and the issue here is time. If the plan is not consummated soon, delays will stretch into the end of the year, which would dispose of the creditors or make them massive litigation targets. Win-win.
the only thing you can count on in a bk is that you never know what is going to happen. Seen too many things that don't make sense and are totally unlawful happen. So don't call me naive? because it is apparent you don't know much about bk's, and the shenanigans that plays out.