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Corrections Corporation of America Message Board

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  • billberggren billberggren Feb 1, 2000 4:19 AM Flag


    We are not against the C-Corp we are against they
    way it was handled. We waited all December to hear
    about our dividend. Then we got our Christmas present
    December 26th, the 8-K. Which basically gives away 38
    percent of the company to the investors for nothing then.
    The actual merger of CCA and PZN was not too bad. It
    is the preferred stock and warrants to the investor
    group. IMHO, the cash infusion is not now needed.
    Especially since we pay no dividend. This company has low
    debt compared to equity, is very profitable, P/E ratio
    of 2, and earnings expections are rising. What is
    want is a C-Corp and a 10 percent dividend declaration
    and elimination of all debt (except to build a
    specific prison). This cash infusion is not needed
    according to the balance sheet.

    With the stock so
    low now 4 3/8, the deal would actually not be to bad
    to new investors. The group must pay $6.50 per
    share. But for us old ones, we got our KY.

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    • Yes, I'm lurking but still here, and still
      holding a position.

      Re: C-corp, well I do know
      that whatever PZN is now, it's not a REIT, because it
      didn't qualify as one in 1999, regardless of
      management's "intention" to be one. What does that make it?
      I'd guess a C-corp. What else could it be at the

      Re: The Blackstone proposal, the whole notion of a
      strategic investor was made necessary by covenents on the
      loans, written by the banks, which insured that more
      funds flowed in before the special dividend was paid.
      Well now the 1999 special hasn't been paid, and can't
      be in the future. So the original purpose of an SI
      has gone out the window with REIT status and the

      Now some have claimed that cash is so short that an
      infusion is absolutely necessary, but I don't see that
      Blackstone is the only group in the world with cash, and the
      options are myriad. Surely one with a fairer outcome for
      current shareholders can be constructed.

      Voting on
      this deal is not about voting for C-corp status (or
      REIT status either, for that matter); it's not about
      voting for a cash infusion (as opposed to going it with
      cash on hand); it's not about saving PZN from

      What this deal is really about is smoothing the exit
      of some incompetent managers by feathering their
      beds and indemnifying them against the repercussions
      of the lousy decisions they've made in the past 24
      months. And in return for doing so, Blackstone carves the
      heart out of PZN's profitability.

      I'm inclined
      to vote no on the Blackstone proposal, and hope that
      some of the larger institutional holders will do the
      same, and moreover, package up some alternative
      financing that will put this moneymaking operation back
      onto the financial base where it can get on with
      making profits. Smaller common holders have to throw in
      with the larger ones and hope they will sponsor a
      proposal with much less larceny than the Blackstone

      • 1 Reply to sumaoji
      • Bravo, your appraisal of the situation is
        succinct and right on target...distilled down to the
        essence.....and since lawuits have been filed against this
        larcenous group of turds the only thing remaining is a
        coalition of the aware common shareholders and a few
        instutions to get behind a third party who will pull this
        opposition together and kick ass. I still believe because of
        the overwhelming vig on this deal ,it will not go
        wanton for another suitor....who will perhaps be brought
        to the table by a large player stung by the deceit
        and arrogance of the Doc/Blackstone triad.
        THE DEAL and book a room for Doc at PZN..
        to give him such good accomodations)...
        I for one
        will send a can of Crisco to PZN to make Doc's stay as
        "smooth" as possible!

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