A broker friend just told me that Sodexho has announced it is looking to sell all its CCA holdings, the stated reason being concern that student protests over private prisons would hurt Sodexho's Marriot/campus food service business.
Does anyone know anything about this? I believe Sodexho is CCA's single largest shareholder.
Arguably, Sodexho has been hurt by the student protests. Student activists claim that their protests have already resulted in Sodexho losing six college accounts,including American University and DePaul University.
For the real deal on Sodexho, check out:
Good Job Percy!! Kudo's to your staff as well. You and your staff have done a outstanding job with the deck stacked against you. Lets see if Mcprison will have the backbone to post this one. Looks like him and his croanies have fallen off the face of the earth.
Kern County Grand Jury Reports On California City Correctional
Institution Operated by Corrections Corporation of America
CALIFORNIA CITY, Calif., May 21, 2001 (BUSINESS WIRE) -- The Kern County Grand
Jury's Law and Justice Committee has high praise for the California City
Correctional Institution, in their report released May 10, 2001. The Committee
finds that "Although the exterior of the prison is very forbidding...the
interior of the facility is the cleanest we have seen in Kern County." The
facility is owned and operated by Corrections Corporation of America (NYSE:CXW),
based in Nashville, TN.
The report goes on to state that Warden Percy Pitzer's idea of using verbal
persuasion rather than physical force (to maintain order) is the opposite of
that used by the State Correctional Officers. "The behavior of the prisoners and
the detention officers reflects a cooperative rather than an adversarial
atmosphere," and "Prospective officers are given a more rigorous background
check than applicants at State Institutions," continue the comments.
California law requires that each County grand jury "inquire into the condition
and management of the public prisons within the County." The Grand Jury report
was in response to that legal duty.
"We are extremely proud of the findings reported by the Kern County Grand Jury
Law and Justice Committee," said City Manager Jack Stewart. "The report confirms
our faith in the privatization of correctional institutions, and in particular
CCA," said Stewart, "They have proven beyond a doubt that the private sector can
operate within this industry as well as or better than public agencies."
California City Mayor Larry Adams stated "CCA had their first report card issued
by the Federal Bureau of Prisons after six months of operation, and got an A+."
He continued, "In today's society, it is rare that business deals are made with
a handshake, and verbal agreements are kept without the need for attorneys'
contracts. From the beginning, CCA has hired locally, purchased locally, and
done everything within their power to become part of this community. They have
the highest respect of myself and the City Council for the way they have
conducted themselves since their arrival."
CCA's California City facility is a 2304-bed medium level correctional facility
that currently houses 1900 Federal prisoners, and is staffed by 549 employees,
half of whom are from the local California City area. The prison adds an annual
payroll of over $20 million to the regional economy.
The Grand Jury report concluded with the statement, "The Committee recommends
that the Warden continue to implement his stated philosophies in the operation
of the prison. The Board of Supervisors of Kern County should encourage the
implementation of privately operated prisons in the County of Kern as a means of
saving the taxpayers thousands of dollars per year."
CONTACT: Corrections Corporation of America, Nashville
Karin Demler, 615/263-3005
Double check this in case I'm wrong...but I believe that story broke in the Tenneessean (Nashville' paper) yesterday, Sunday. You might see if you can find it at their website. The essentials of what you stated in your post are exactly what I remember reading. Also that John Pierre Cuny (think that's right) will give up his Board seat as part of the sale.
The post split price seems to be holding up ok at least at this point in the day. That's suprisingly good news.
I found it - thanks. What I found interesting is Mr. Ferguson's comment in the news article, "we've known about this for some time." Oh really???? And when were you going to tell us?????? I'm sure there's no intent to deceive, but he shouldn't have admitted that he'd known that his largest shareholder wanted out "for some time." I personally think that's material.
I know management has a lot on its plate right now, but a key weakness at the company is its lack of a professional IR department. The contact person, Karin Demler, is very nice and helpful, but her job seems to be to help with paperwork, not to develop and implement a formal communications strategy with the investment community. Having some kind of IR structure would be a big help since we're now looking for a big buyer - and a new Board member.