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Vonage Holdings Corporation Message Board

  • saliman8731122 saliman8731122 Jan 26, 2013 1:20 PM Flag

    Vonage is a scheme by Citron for Citron, not you. SEC wont do jack.

    Sometimes posters write of Vonage implying the SEC should investigate. You must think the SEC cares. It takes more than your mere wish to get the SEC to act. What business is it of the SEC that Vonage runs its company poorly? You think the SEC has some enforcement authority related to the fact that Vonage is a poor investment for shareholders with no return to investors, i.e. no dividend.

    The way shareholders gets things fixed, in theory, is that shareholders act. The practical impediment here is that shareholders would not and could not act because this is Jeffrey Citron's personal show and he and his cronies have too many shares to do anything to throw out the Directors or management. There also has to be a claim that would be made, not just a wish on the emotional whim of a disgruntled investor.

    If you think the SEC can tell a company to work to raise its price, you are missing the purpose of the SEC. The SEC acts within its discretion to enforce laws on the books as interpreted through past cases that went up on appeal. You who think "the SEC needs to act", how about you reference or cite the exact statute down to the quoted language which would apply here. Reference actual enforcement actions against some past or current company doing or that did what you purport Vonage is doing. I doubt you will name anything Vonage is doing that violates the law which would result in an enforcement action. Because if Vonage were doing something wrong, there's be a line of plaintiff's lawyers lining up to file shareholder derivative suits. I have not seen that line since the IPO sales to customers and since the patent violation losses to AT&T, Verizon, and other companies----- (Vonage was ruled to have violated some patents some time ago).

    If you are arguing that there is some form of collusion generally to keep the price sort of low or generally stable within some range that makes Vonage a lousy takeover target, then you would have to show that the means by which this is accomplished is hidden from the investment community. The poison pill is public so there's nothing hidden about this. We all can read between the lines that Vonage is a horrid investment unless you have a sweetheart deal like Jeff Citron does.

    It's fairly obvious that this company's share price is kept low within a range (in part by the poison pill) so it can be bought out eventually at the lowest possible price by Citron's cronies. Shareholders will be lucky to see a mildly high bid though. It could be five or ten years from now too. That's why investors should stay away from Vonage

    Conclusion: What a total waste of opportunity and money Vonage is. It's as though the purpose of Vonage is to bumble along like a Golem, passing hundreds of millions out to friends and agents in the ad business, passing low entry options and shares to Citron and those who benefit from such, passing what were once high returns on loans to Silver (expensive debt now refinanced or paid), and passing EXPENSIVE IPO shares to the general market to raise the money to fuel this engine.

    Two questions:
    1) Who loses on Vonage? Everyone except former Datek's former Jeff Citron (and his cronies).
    2) Who wins on Vonage? Jeff Citron (who the SEC sanctioned from being the CEO of Vonage because of his past siphoning of funds while with Datek).

    Bonus question: 3) Who would invest in a company strategized by Citron? Before you answer consider that Citron is "barred [by the SEC] from association with any broker or dealer".

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    • This is a thoughtful discussion. Many times there are complaints that the SEC needs to investigate this or that. Perhaps this would be a good primer for an article in Seeking Alpha or another publishing forum. Vonage is an interesting study.

    • That is true that Citron is barred from association with any broker or dealer. I looked it up and indeed Citron got in deep SEC trouble. You can find the details at the Jeffrey Citron Wikipedia entry.

      • 1 Reply to parginalist
      • The big question is if Citron has learned or not because as far as his business experience,talent and instinct he is definitely an asset.Datek was top of the line discount broker.
        Is there any suspicion that he is repeating same pattern with Vonage or this is just your tired imagination looking for explanation why you are loosing money or being left behind by the market.
        The second topic is lot more troubling to me.Is Lefar loosing his "motivational influence" over his midmanagement workforce?
        Obviously we will not be able to find out with official line of annoucements untill is too late.
        jp

    • Very true. My take is that the constant insider selling is also designed to keep this price down. If Vonage goes too high, it attracts funds whose limits restrict buying shares under a certain floor price, i.e. 5 bucks or under a billion market cap.

      I can tell you why Vonage PPS has risen in general since the peak of the housing crisis when the price fell through the floor. Being in the Russell 2000 has raised Vonage more than anything else. The Russell and tracking funds have to buy Vonage as funds move in from bonds and sidelines regardless of the quality of Vonage.

      Sector funds that must buy telecommunications shares and certain technology funds also are forced to have some Vonage. These got influxes as the 2008-2010 crisis subsided. The managers are forced to buy Vonage shares regardless of prospects or fundamentals.

 
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