thats what I thought 9 months ago in the $3's and then again 3 months ago when LIWA pullback to the $4.60's very briefly. Maybe now we might get yet another chance to nibble in the $4's again.
The most interesting part is 3 years ago when LIWA hit $13 it had a $3 book value. Today it hit the high $4's and has a $10 book value. I guess that is what you get when the entire bunch was spoiled from a few bad apples mixed in with massive shorting attacks, fraud and accounting uncertanties and all kinds of fear.
Agreed. Despite CEO's assertions to the contrary, LIWA will be subject to an MBO in the next few quarters. At the rate cash is accumulating, management will be able to offer $6.50 and buy LIWA with cash on the balance sheet.. Shareholders will complain about a low ball offer, the plaintiffs bar will file its typical class actions and the management will smile all the way to the bank. Long weary shareholders, management and arbs will form a sufficient quorom to accumulate the majority needed to carry the vote.
There was an article in the New York Times on Sunday (or maybe Saturday) in the Business section on the Dell buyout. Apparently if a majority of the non-management shareholders request it, we can go to court in the case of an MBO and ask the court to determine a fair price for the company. Once the court determines the fair price that is what management has to pay in order to perform the MBO. It is a seldom used law, but it is being tried in the Dell case. Most MBOs occur at a big discount, but only a few are challenged this way. Most that do win and get at least 50% more than they would have otherwise. If a buyout offer were less than $20, I think it would be worth it to try.
I used to be in your camp on a cheap MBO scenario, but with time this thesis does not seem to be the case. Cash is piling up and CCA situation is becoming more mature. I am now of the camp that the CEO could care less about shareholders (of which he is the major holder) current PPS value. He is focused on execution which he has done to a tee. I can not find one example of the story that is not in line with building up smelting capacity and new product development (CCA Cable). He built all these buildings for a reason. Look at the size, shape, and capacity. They were not all put there for smelting capacity. Their shape and size are perfect for the manufacturing of cable forming production. The time for a MBO was back in the $3~$4 range. I just don't now how much longer the cat can stay in the bag. I think shorts likely use this day to start a panic and cover more shares. Good luck to all longs who have held and still believe. These buying opportunities at 88% of cash don't come every day. I will keep buying below $5.40 as cash comes available.
Why would CEO wants to get money from P.E. to go private and subjects to harsher term & condition. CEO doesn't like debt and it shows from his balance sheet, if he wants LIWA to go private, he will need $170MM to $200MM, with current tight credit & high interest environment, chances of MBO is slim. Can you tell me why CEO wants to do a MBO in the next few quarter?