Complete punt on the warrant question in the conference call. Still talking with their advisers. I wish they were buying warrants with the money they are spending on those advisers. After them saying last year to expect something on the warrants in the 3rd quarter 2011, this punting is getting old.
sounds like they have bigger things to worry about...like deploying capital. My guess is, when they start getting to full capacity, we get a conversion offer. Until then, Stuart's time is better spent on execution. Still have lots of (accretive) capital to deploy.
The stock was a blank check company called NRDC Acquisition and sponsored by an investor group including Richard Baker who owns Lord and Taylor. The sponsor group owns a ton of founder warrants and the fear is that exercise of the warrants will result in a lot of short term dilution. On the plus side exercise of the regular warrants gives ROIC new capital, but on the negative side the founder warrants allow cashless exercise - they exercise and get an amount of shares determined by a ratable formula based on warrants allowed on exercise, exercise price, and market price.
The idea is that ROIC mgmt needs to reduce the founder warrant overhang in an advantageous way and that would allow the stock to rise faster.