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W.R. Grace & Co. Message Board

  • fbertital fbertital Nov 21, 2012 1:11 PM Flag

    What is the opinion of long term followers now?

    I have a feeling that once they come out of chapt.11 the losses they report will move the stock down. I wrote coverd calls. I don't know what to think . Even if they make $4.85 a share they have to use the charges of payments to victims and I can't see much in profits but might make them an attractive take over.

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    • Having owned a chunk in the 3-4 range I've grown wary and switched half of my position into Dupont before yearend.

    • They have set aside more than enough earnings during bankruptcy to pay for the Asbestos costs.

      I believe that the company will be broken up and sold off after exit of bankruptcy.

      The only concern I would have is that many of the top officers are selling their options.

      • 1 Reply to bill131313bill
      • If you go to the SEC website and search under GRA filings, you will find that as of 2008, the 10-K filing shows that GRA has set aside $1.7 billion for the Asbestos claims.

        The other reason that they may not be out of Chapter 11, is part of the original agreement. Under the proposed settlement, the Personal Injury (PI) would have the right to buy 10 million shares of GRA up to one year after the settlement for $17/share. GRA probably never thought the stock would be almost $70/share when the agreement was proposed. The 10 million shares would dilute the stock by about 13% and reduce the EPS by about the same.

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