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ACI Worldwide, Inc. Message Board

not_totally_gray 32 posts  |  Last Activity: Jul 11, 2016 9:01 AM Member since: May 14, 1999
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  • not_totally_gray not_totally_gray May 31, 2016 10:43 AM Flag

    Bottom line is that issuing common stock @ 11% yield to redeem preferred stock @9.5% yield is unfortunate, especially when they've been buying back common stock in open market at higher prices.

  • not_totally_gray by not_totally_gray May 31, 2016 10:27 PM Flag

    lately -- especially this past month -- SEP has dramatically underperformed SE. Comparing to some other MLPs that I own, this seems to be equally due to SE doing relatively better, and SEP doing relatively worse. Anyone have any good reason why? Thinking seriously of taking advantage of the opportunity to swap my SE for SEP.

  • Reply to

    2x all equity deal on the way

    by harehau May 31, 2016 10:52 AM
    not_totally_gray not_totally_gray May 31, 2016 10:39 PM Flag

    No way they screw with the div in these circumstances. I wouldn't be surprised if they declared a massive special div just to stick it to Kelcy right before the merger.

  • Reply to

    2x all equity deal on the way

    by harehau May 31, 2016 10:52 AM
    not_totally_gray not_totally_gray May 31, 2016 11:01 PM Flag

    2.2X is kind of the magic number here because it lets WMB mgmt say with a straight face that they're getting a premium, but it also is about the ratio of the ETE/WMB cash distribution... so the total cash burden of the post-merger distribution is about the same, so I have feeling that's about where this will end up, with no meaningful cash outlay. That "values" WMB at about $28, trading at a 9% yield, which I think is most you're going to get for now. I don't think the new ETC will trade at any sort of decent valuation like the blue-chip MLPs until a couple quarters are in the books for the combined company, I wouldn't be surprised to see it trade down to 10% or so.

  • Reply to

    SE Two Year High $43

    by balooga2_2000 Jun 3, 2016 10:17 AM
    not_totally_gray not_totally_gray Jun 3, 2016 1:19 PM Flag

    but cash flow hasn't budged. DCP stake has evaporated, falling canadian $, giving away assets to DCP -- plus when it was $43, it was fundamentally overvalued @ 3% yield. Simply increasing the payout ratio shouldn't boost the stock price.

  • Reply to

    div

    by harehau Jun 8, 2016 8:03 AM
    not_totally_gray not_totally_gray Jun 8, 2016 8:46 AM Flag

    ETE has already announced no div if the deal closes... if people vote the deal down for that reason, than WMB cuts their div anyway, they'd get sued out the wazoo.
    As for amount of cut, it depends on the announced reason... if the main reason is just to true up the payout ratio with sustainable DCF, maybe it only gets cut to $2.00. If the main reason is to supply WPZ with capital for expansion, they'll do a Kinder Morgan thing and cut down to a token level.

  • Reply to

    wmb div

    by harehau Jun 8, 2016 8:10 AM
    not_totally_gray not_totally_gray Jun 8, 2016 8:52 AM Flag

    Not exactly a shock. That was IMO the premise of the original WPZ-WMB roll-up, reducing the overall distribution burden.

  • Reply to

    wmb div

    by harehau Jun 8, 2016 8:10 AM
    not_totally_gray not_totally_gray Jun 8, 2016 9:55 AM Flag

    I think that is just keeping themselves from getting sued -- if WMB people vote down the merger because ETE has already announced they will eliminate the dividend, and then WMB immediately cuts it anyway, that's not going to look good. The fact that their own div is about to be cut is material info when deciding to vote for or against the merger.

  • not_totally_gray not_totally_gray Jun 9, 2016 9:39 AM Flag

    So much for that theory...
    http://finance.yahoo.com/news/seaspan-announces-public-offering-series-131029343.html

    Curious to see if these new preferreds will be cheaper or more expensive than what they just redeemed.

  • not_totally_gray not_totally_gray Jun 9, 2016 4:10 PM Flag

    Looks like new preferreds are priced at 8.2%, noticeably better than the ones they just redeemed, so a good data point.

  • not_totally_gray not_totally_gray Jun 14, 2016 11:16 AM Flag

    ETE has already announced that the distribution will be cancelled when the WMB merger occurs. If the merger does not happen, there is still a chance -- 50-50? -- that the distribution will be reduced, but I doubt it would be eliminated completely.

  • not_totally_gray not_totally_gray Jun 15, 2016 1:19 PM Flag

    This is clearly stated in the merger doc that was sent to shareholders.

  • not_totally_gray not_totally_gray Jun 15, 2016 1:21 PM Flag

    I've owned it since 2008 -- thought I'd seen everything with this stock, but obviously, what did I know...

  • not_totally_gray not_totally_gray Jun 16, 2016 2:27 PM Flag

    This is copied-and-pasted directly from page 23:

    " However, ETE no longer expects to pay cash distributions with respect to its common units following the closing of the merger until the quarter ending March 31, 2018"

    This has also been discussed a million times in different forums, it's not exactly news.

  • not_totally_gray not_totally_gray Jun 16, 2016 7:28 PM Flag

    Nope, it's all the common units. See pg 25, where WMB discusses its impact on the merger:
    "The WMB board has reviewed ETE's statement that it does not expect to make any cash distributions with respect to its common units following the close of the merger... The WMB board notes that a lack of distributions on ETE common units will lead to a lack of distributions on ETE Class E units, and therefore, on ETC common shares."

  • Reply to

    Buyout Price per SHare

    by casmiata Jun 21, 2016 10:31 AM
    not_totally_gray not_totally_gray Jun 21, 2016 9:51 PM Flag

    If the market thinks the deal will go through, WMB isn't going to rise -- ETE stock will collapse to $10 or below, that is how the large current premium will resolve itself. I hesitate to predict how low ETC stock will go once people start dumping it after the deal closes. I'm sure plenty of WMB folks will be selling their shares at a discount to prevent larger losses when ETC starts trading.

  • Reply to

    Hanjin Shipping

    by oddball_activist Jun 21, 2016 11:16 AM
    not_totally_gray not_totally_gray Jun 22, 2016 9:47 AM Flag

    I assume the problem isn't Hanjin per se -- which is a small customer -- but the possibility that it is just the canary in the coal mine. What happens if a larger customer has similar distress OR if SSW reworks Hanjin's lease, wants *their* terms renegotiated also? I'm sure that accounts for the very strong tone of Wang's public comments on Hanjin.All of their customers are competitors of each other and they're all in some degree of pain in this market, so I can't imagine any of them will be pleased if one of them gets their deal reworked on better terms.

  • Reply to

    Deal Going To Be Nixed

    by protazoid Jun 22, 2016 1:58 PM
    not_totally_gray not_totally_gray Jun 23, 2016 8:35 AM Flag

    WMB shareholders have no reason at all to sue ETE... their own board agreed to the deal, so any damages to WMB shareholders should go to them, especially if ETE wins this suit and no misconduct on their part is proved. No one forced WMB into this deal... I suspect they did it to mask their own cash flow difficulties (which was the point of the WPZ roll-up that preceded the ETE deal) which are now out in the open, but that has nothing to do with ETE, it has a lot more to do with overpaying for Access Midstream at the top of the market.
    Although I hope the convertible deal *does* get canceled...

  • Reply to

    This whole thing can get worse

    by left_wing_lock Jun 23, 2016 6:13 AM
    not_totally_gray not_totally_gray Jun 23, 2016 8:44 AM Flag

    Correct me if I'm wrong, but even if WMB wins an appeal, if it comes after June 28 and the deal hasn't closed, ETE can't be forced to complete the deal. At that point, the only point of an appeal would be monetary damages. My impression is that the June 28 deadline is a hard deadline, if it doesn't close by then everything is off. (Unless there is some way they can get a Supreme Court to rule by June 28, which seems unlikely...)
    I would think even if ETE lost an appeal, the monetary damages would be somewhere between the break-up fee specified in the merger agreement and the amount of "synergies" that WMB estimated in their latest statements.

  • Reply to

    Deal Going To Be Nixed

    by protazoid Jun 22, 2016 1:58 PM
    not_totally_gray not_totally_gray Jun 23, 2016 10:12 AM Flag

    They already tried that... before they signed the deal with ETE, they shopped the company around and there were no takers. Maybe a PE firm might be interested in taking them out now that share price is ~$20 and take it public again in a couple of years if cash flow has improved and energy markets have recovered.

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