I suspect they are contemplating taking the company private. In several of the conference calls over the last several years they have mentioned rising competition for deals from private equity groups. It is hard for public companies to compete with private equity. Going private would remove restrictions on equity ownership and unincorporating would remove double taxation concerns.
Wow, things must be worse than I thought. The strategic alternative move is one of desperation by companies that have crashed. The end game has arrived for this fund and its money losing mgt team. Think about it. If they wanted to just liquidate and give back the shareholder value, why not just do it? Or sell off a chunk and special dividend the money back. Heck, even a div raise might help but clearly that is an option not available, probably due to debt covenant restrictions.....or worse. There are few alternatives when much of your portfolio is in default ( Huff ) or in bk ( ATP) and who knows what is happening elsewhere. This fund is deep junk and there may be another blowup we are not yet aware of. This is not a positive.
Sentiment: Strong Sell
just a dumb question from a beginner. If Tipotcsh feels a strong sell, should we assume he has followed his own advice and bailed out of this sinking ship. If he still has stock, why would he be beating it down? Is this what a "short" sounds like? Just saying...
Agreed - it can't hurt to look at "strategic alternatives to enhance stockholder value." Just more proof that mgt has their heads screwed on straight and are primarily concerned with creating value.
Such short memories this board has. Or probably, they simply don't know about this mgt.
In Nov of '11 they announced a buyback because they considered themselves undervalued. Funny thing though is that mgt slashed the div of this great value fund a mere 90 days after saying they were undervalued. It went from .18 to .12 and has NEVER recovered. Kinda makes you go HHHMMMMMMM. Then to add that later in '12 they jumped into GMX resources only to lose that investment in a matter of a few months. So our undervalued fund moved closer to its value, lol. This mgt can only make claims of being undervalued but as they do, the fund continues to shrink away.
This statement is another in a long line of pumps by mgt that gets smacked head on with a dose of reality. The reality is this fund only gets the dregs of the dregs. Any kind of decent investment is taken by better funds and banks.
Sentiment: Strong Sell
Sure hope you are right and it is not just a way for management to get more money for themselves.
Just be wary of them giving the company a way to enrich their own pockets.
Sentiment: Strong Buy