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Corrections Corporation of America Message Board

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  • newMK newMK Feb 17, 2000 11:58 PM Flag

    CCA in the news today

    Hate to say I'm confused, but the numbers still
    don't add up for me. The combined companies maybe
    needed $100MM (wild guess)to keep operating for a good
    while (not counting capital expansion). But to get
    that, they had to "de-REIT". By merging in 2000 they
    get no 1999 benefit of OPCO's losses, so they owe
    $100MM in tax. They stubbornly paid their Q3 dividend
    (60+MM)in cash. Perhaps 50MM of fees and severance and cash
    buy backs. Another $40+ MM for next year's new pfd
    divs. That's $350MM, plus 150MM "cushion", which
    they'll get with the new equity money and the expanded
    bank line. But they probably just needed $100mm to
    start with.

    The proxy has a lenghty discussion
    of what they went through to get where they ended up
    with Blackstone/Fortress. Guess I'll have to read it
    again more slowly, but as I recall it's pretty
    deficient when they explained away the "stand-alone

    The discounted cash flow analyses by M/L
    and Wasserstein are pathetic.

    Flipper's right
    (and I posted it some time ago) - the banks shoved
    this deal down their throats. They should have just
    merged (with a vote) by 12/31 and borrowed $100MM from

    Beasely, you blew it.

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