España
Escucha eso Besugo te traera paz a tu alma atormentada,quisiste comprar bonos de wamu mas no lo hiciste, esa es tu fustracion
https://www.youtube.com/watch?v=MclLF473XtA
https://www.youtube.com/watch?v=5lMbVzFtvM8
Que fue de tu comparsa el inmigrante, parece que el EBOLA se lo llevo a buen puerto.
A Inmigrante se lo llevo el ebola o a saber porque esta desaparecido en combate. En cuanto al camarada Besugo no va a cometer la insensatez de meterse en terrenos pantanosos comprando estiercol.
Ya veremos quien lleva la razon pero de momento pintan bastos para las acciones antiguas y nuevas.
Alguien se ha forrado bombeando informacion falsa, ten cuidado no acabes perdiendo hasta los calzoncillos PPtrueno, el mundo lo gobierna quien se queda el dinero de los incautos.
Damnificados los hubo a cientos entre ellos el bueno de Ten Shin que acabo buscandose la vida entre los contenedores de las calles. A alguien le debe estar pesando la conciencia.
Ok, if not for the NOLs - then two questions come to my mind:
1) Then.. Why wouldn't KKR and Citi just form a new corporation for whatever they have planned. Eg, why would WMI play into it?
2) Or... What other asset -- now, or as you put it - 'future' - is valuable enough for KKR and Citi to invest in WMI to gain benefit from?
As has been stated in this thread the machinations of the large players will often escape our own knowledge base. We can assume that those with $ millions/billions to invest have their reasons for choosing one path over another.
Suppose that KKR and Citi are not the only interested players. Information relevant to the upcoming Preferreds transaction reveals that KKR/Citi encourage other qualified participants to join them. Speculate that AAOC, having withdrawn their approved offering from the BK resolution, chose to reinvest that money in WMIHC by way of equity purchase. Couldn't using WMIHC as a parent holding company to bring entities in which AAOC/KKR already have invested increase the value of investment in both acquired and acquiring entities?
For instance- KKR and Centerbridge have interests in Capmark. Capmark has recently taken on debt to acquire Bluestem. A merger with Capmark by WMIHC could provide funds to extinguish or greatly reduce Capmark's debt.Such a merger could also return some of KKR (and possibly Centerbridge if they chose to participate in the Preferreds Offering, through their investment in Capmark if not) investment in WMIHC to them reducing even further the amount they may have paid for WMIHC shares. WMIHC will have a profitable debt free subsidiary with existing interests in financial and real estate markets which also owns a subsidiary with nearly a billion dollars per year of mail order/online sales.
Right on. It doesn't make sense for KKR to partner with WMIH if not for the latter's NOLs assets. KKR has money and can invest in a wide range of companies, why subject itself to the tricky, cumbersome IRS 382 rules if not for WMIH's sizable tax benefits? If and when mergers happen, the business is likely to further expand. But the driving force for WMIH-KKR partnership right now is NOLs assets. WMIH's intent is pretty clear that they want to grow the company by acquisitions, the acquired company or the combined company as a whole has to be profitable so the company can enjoy the benefits of an expanding business and its inherited tax assets. Simple as that.
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La paciencia tiene año y premio.
Año 2015
Premio: Ganar la partida.
Feliz fin de año y que 2015 sea un gran año para todos.
Ya vale de bombeos Simpson, la parroquia esta mas que pillada, si te ves Los balances hay mas posibilidades de ganar jugando a Los ciegos
WaMu's $600M Private Rebirth (Nos valoran sin M&A desde $2.77 a $4.11)
Dec. 29, 2014 3:46 PM ET | About: WMI Holdings Corp (WMIH) PRO subscribers have an early look at this article until Dec. 30, 3:46 PM
Disclosure: The author is long WMIH. (More...)
Summary
Citigroup and KKR to purchase $600M in preferred stock.
Deal values WaMu at $1.05B.
WaMu to uplist to a national exchange.
Sets 180 day time frame for first M&A.
Six Month Price Target: $4.11.
On December 19, the reincarnated Washington Mutual (OTCQB:WMIH) announced that it would be joining forces with Citigroup (NYSE:C) and KKR (NYSE:KKR) in the sale of $600M of private equity to the financial giants. Under the terms of the deal, Citigroup, KKR, and "KKR affiliates" would each purchase $200M of 3.00% Series B Convertible Preferred Stock, with the plan for WaMu to use the capital to pursue and fund future acquisitions. WaMu shares moved higher on the news before settling back some over concerns of dilution to existing shareholders.
The issuance of the preferred stock, expected to close on January 5, allows the company to move forward in the utilization of its $5.96B of NOL assets acquired during its bankruptcy, without triggering a change in ownership that would otherwise restrict them under IRS Section 382 limitations. While preferred stock is generally regarded as a hybrid instrument, this Series B is purely an equity play by Citigroup and KKR with its built in mandatory conversion. The conversion is set to occur automatically the day after the company completes its first acquisition.
For WaMu's shareholders the deal has been long coming, with the holding company of the former banking institution approaching its three-year post-bankruptcy anniversary. For many die-hard retail shareholders, WMI Holdings represents the only viable remains of Washington Mutual after the FDIC seized the bank in September 2008 in a controversial move that transferred tens of billions in value to JP Morgan (NYSE:JPM) but forced WaMu into instant bankruptcy. As the primary source for their financial recovery, shareholders have eagerly awaited share appreciation, with some doubling down in an effort to break even on prior losses. In March, WMIH shares hit a high of $3.74 in heavy expectation of a deal centered on the company's two-year anniversary, but then steadily declined in the months following as the fatigue and cost of waiting took its toll.
Big Capital, Big Dilution
While the equity raise nets WaMu $568.7 million after fees, it comes at a serious cost to existing shareholders in the form of massive dilution. Based on the initial conversion price of $2.25/share, the mandatory exchange of the Series B will result in an additional 267M shares against WaMu's current 202M share count. The combined 469M shares would result in current shareholders surrendering 57% of WaMu for $600M, and would value the company at $1.05B or $2.23/share. While simple math would dictate that current share prices should move to close the gap in evaluation, the reality is that the total dilution is not a fixed number.
While the Series B has an initial conversion price, it also has an alternative conversion provision built in if share prices continue to remain below the $2.25/share threshold. The alternative conversion has a floor set at $1.75/share, meaning a worst case maximum of 343M shares, and is based upon the volume weighted average price (VWAP) of WMIH in the twenty trading sessions prior to its announcement of a definitive agreement with its first acquisition. For example, where WaMu to announce its first acquisition on January 6, then the VWAP would be based on trading back to December 5. Assuming a worst-case conversion, WaMu would rise to 545M shares and a market cap of $953M based on the preferred sale evaluation. Such a conversion would cost current shareholders an otherwise avoidable loss of 6% of their company. The bottom line, current shareholders have a vested interest to keep WMIH shares above $2.25.
Failure to Launch
The reason why WMIH shares have remained below $2.25 is that KKR already holds an additional 71M shares not yet accounted for by the company's current float. 9.6M shares exist in the form of Series A preferred stock and 61.4M in warrants granted to KKR earlier this year. The reality is that WMIH's future total share count ranges somewhere between 540M and 616M shares.
It is this uncertainty of a final share count, plus the expectation of flipping and getting in at lower prices, that keeps share prices at their current levels. Flippers familiar with WMIH's six-year history have done well, seeing profitable intraday swings of up to 89%. In the past year, shares have seesawed over 100%, rewarding those unafraid of being left behind should a deal announce, and burning shareholders who bought in on high expectations of a soon coming deal, only to see share prices repeatedly regress. Given that everyone appears to be waiting to get in at the lowest price possible, shares have continued to decline, ignoring the underlying value of the company.
Evaluating Uncertainty
Part of the uncertainty around WaMu's share price is because the company lacks the typical guideposts by which to evaluate a company based on its fundamentals. For example, WaMu's current P/E of 42 is based on a reassessment of its mortgage reinsurance subsidiary and the booking of released insurance reserves as a profit. While future reserve releases are likely to happen, albeit on a smaller scale, such events are one time. Consequently, the company currently lacks a steady revenue stream by which to determine its true value. Determining the current value of WaMu, before it makes its first acquisition, can only be based upon cash on hand, NOL discount rates, and WMMRC equity.
Currently, WMIH holds $78.3M in cash, which will rise to $647M after the sale of the Series B shares. Next, its $5.96B in known NOL assets is worth, in principle, a savings of $2.1B in taxes. However, it will take time for WMIH to use this asset, which decreases its present value. Using a discount rate of 7%, based on the company's current lines of credit, and over 5 years, the NOL value declines to $1,451.2M. Meanwhile, the preferreds' purchase values the NOL at $940M, because in essence Citi and KKR are buying 57% of WaMu's cash, NOLs, and WMMRC equity for $600M.
Lastly, WaMu's run off subsidiary WMMRC lists $57.4M of equity in its last 8-K but has $31.7M of outstanding PIK notes paying 13%. While WMIH has signaled it will be paying off 80% of this come January, the subsidiary has to work through its expected insurance losses while also reevaluating insurance reserves and collecting premiums on contracts that won't resolve until 2019. By my estimates, WMMRC is worth approximately $34.3M.
(click to enlarge)WMIH Valuation Table
Based on the above numbers, WaMu has a worse case share value of $2.77 and a probable value of $4.11.
The Uplist Effect
Besides the capital injection and automatic conversion mandate, the sale of the preferreds includes a listing obligation that WMIH use, "...reasonable efforts to list (the) Common Stock on a national securities exchange after becoming eligible to do so...." WMIH is currently listed on OTC Markets OTCQB, on an unsolicited quote basis, with trading not endorsed by the company as to protect its NOL assets. WaMu's presence on the OTC limits the amount of demand for its stock as many institutional investors are prohibited from investing in OTC stocks because of their charters. Others use guidelines concerning minimum share price and avoid low-priced securities. So far, WaMu has remained off a national exchange because of the administration costs and filing requirements related to such a listing. It makes sense that once the uplist occurs, institutional money will become available and flow into WMIH, increasing volume and driving share price to fair market value. In addition, because securities trading on a national exchange are more regulated and therefore perceived to be less risky, it is argued that some additional 'safety' premium should be paid for such shares.
Unfortunately, there is no hard and fast rule on what to expect concerning share prices when a company uplists or what the 'safety' premium should be. For years the "uplist pop" has been touted as a profitable, low-risk strategy where hedge funds and individual investors load up on shares to resell to institutional investors once the burden of their self-imposed rules are lifted. However because so many are attempting to make the same flip, share prices often decline the day before the uplist occurs and continue to decline the day of arrival upon the national exchange. In looking at four more recent uplisters, OTCQB:OTCQB:BBLU, OTCQB:OTCQB:BCLI, OTCQX:OTCQX:CVSL and OTC:OTC:PVCT, the uplist had no significant effect other than in volume, and all companies are now trading for significantly less than their day of uplist. In each case however, the reason for the decline is based upon each company's flaging fundamentals. This situation is not likely to repeat with WaMu as the company will want to be immediately profitable to use its NOLs.
Only the Beginning
While WaMu's uplist will certainly benefit the company by increasing volume, liquidity, and investor exposure, there is no way to quantify this directly in regards to share price. Therefore, I am attaching no additional premium to share price related to the uplist. Rather, simply being on a national exchange will increase the company's gravitation towards the above detailed fair value of $4.11/share, a 96% return based on the December 26 closing.
Because WMIH intends to complete its first acquisition, mandatory conversion, and uplist all within 180 days of January 5, and in absence of any acquisition details, I am setting my six-month target as $4.11. Once WaMu announces their first purchase, which is likely to be a leveraged buyout, analysis of the target company will allow for a much more accurate determination WaMu's future value, and will render all previous valuations inaccurate. In a way, putting a value on WMIH at this particular point in time feels a lot like pinning the tail on a piñata because so much is going to change in the next few months. This is only the beginning.
Editor's Note: This article discusses one or more securities that do not trade on a major exchange. Please be aware of the risks associated with these stocks.
Troy Racki
Deep value, long only, special situations, long-term horizon
Seeking Alpha
Si os valoran 2,77 / 4,11, como la mayoria de acciones bombeadas para que compren incautos cuando vendan los que las valoran a ese precio
Acabas de inventar la sopa de ajo
Feliz año 2015 a todos!
el año de WMIH