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CommonWealth Reit Message Board

  • deanmortensen deanmortensen Feb 27, 2013 4:03 PM Flag

    RMR continues to stiff-arm CWH shareholders...unbelievable!!!!!!!!

    I just don't understand what in the Sam Hill is goin' on with CWH! Those shareholder activists (Corvex and Related) sent a letter to CWH with details about financing for their $25/share takeover offer. They also say they'll likely raise their offer price after completion of due diligence, because some third parties have expressed interest in buying some Commonwealth properties. So, what does CWH management do? They issue a press release saying they are going ahead with their 31 million share sale and senior debt buyback plans. Then the stock price drops 9% to $22, when there is a $25 buyout offer on the table!!!!!! Unbelievable!!!!!!!

    Can RMR and the Portnoys really get away with hijacking Commonwealth like this? I thought the SEC was supposed to supervise markets and company managements, stop governance abuses, and impose the rule of law! Look, there's a $25 offer on the table, and that offer may be increased if Commonwealth calls off the dilutive share sale. Can the Portnoys really stick their thumbs in shareholders' eyes like this? Why doesn't Vanguard and the other large shareholders throw their support to Corvex and Related? Why are they letting RMR steal Commonwealth?????????

    Sentiment: Hold

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    • The hedge funds are not our friends. They are in it to break up CWH and sell the pieces screwing the preferred holders. Many of the hotel reits did this a few years ago. Went private and levered up to the point of high risk. The companies went bk and the preferred was worth zero. The common owners got a little bump on the takeover but nothing to get excited about. Further issuing stock to retire the debt does not dilute earnings. It just substitutes dividend payments for interest payments. If interest rate rise it is a good move, if interest rates fall it is a bad move.