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thanks for sharing Joe. Much aperication.
Back of the envelope calculation (very rough numbers from someone that should not even be attempting to try to estimate value left over for the preferreds. Do your own DD.)
The proforma post bk shows a book value of $8 bil. If CIT were to sell for 1.5 times book that would lead to a market cap of $12bil.
Those claims above ours that are not going to be paid in full, but at 70 cents on the dollar is about $36.7 bil. At 70% ($25.7bil) that leaves a balance of $11 bil that they will be due in stock. That leaves $1 bil to cover the preferreds shares claims of about $2.8 bil in Series A,B, and D. That is about 35 cents on the dollar in CVR.
Of course if CIT sells for not much less than 1.5X book we are screwed. More than 1.5X book and we get very happy.
Again, these are very rough numbers. Just wanted to share my thought process.
it will be like throwing us a bone
and keep tax payers happy with the z stock and this one that is in par to the z shares.
differences between cit bankruptcy and other bankruptcys:
https://www.motorsliquidation.com/
http://www.epixpharma.com/
http://chap11.epiqsystems.com/clientdefault.aspx?pk=de7ced2b-52e7-4172-92e1-9ec425933bd0&l=1
http://www.wamuequity.org/
Not exist on the Cit web any section where clearly say that shareholders will get nothing, only in old documents preceding the bankruptcy, is for fear of one equity organization?
maybe but I haven't seen anything on it yet
I think they will throw something to the A and Z shares.
no new common all share we be wiped out
One share of new common plus two warrents?
They will not give any cash out
research177, so you believe CITBQ (CIT-A), will get some sort of money? how much $ do you think each share of CIT-A will get?
What To Know About CIT
Matthew Craft, 11.02.09, 4:00 PM ET
http://www.forbes.com/2009/11/02/cit-carl-icahn-treasury-goldman-markets-bonds-faq_print.html
After months of haggling with creditors to avoid bankruptcy, the commercial lender CIT Group filed for Chapter 11 protection on Sunday. Bondholders rejected the company's proposed debt swap but accepted CIT's plan for reorganization. If all goes as planned, the commercial lender could drop $10 billion in debt and exit bankruptcy owned by its current bondholders by the end of the year.
The bankruptcy filing ended a series of twists in CIT's efforts to survive, highlighted by the sudden appearance of billionaire investor Carl Icahn. In recent weeks, Icahn railed against CIT's board, tried to rally bondholders to scupper both the proposed debt exchange and plan for bankruptcy, and also offered to float the company a loan. CIT rejected Icahn's first loan offer and turned to another lending group, which includes other large bondholders, for a $4.5 billion loan.
But that wasn't the end of it. On Friday afternoon, CIT said it lined up a $1 billion line of credit from Icahn, which could be used as debtor-in-possession financing in bankruptcy. That came after the company made a batch of other moves, altering its reorganization plan and settling a loan arrangement with Goldman Sachs. So much has happened in recent weeks that observers are bound to be confused. Here, then, is an attempt to clear up some of the most common questions. We'll update the list throughout the week.
Q: What happened to that derivative contract CIT had with Goldman Sachs? Did CIT have to pay the bank $1 billion to go bankrupt?
CIT and Goldman reworked the agreement last week. They trimmed the $3 billion facility to $2.12 billion, shedding the unused portion, and CIT made a $285 million payment. Goldman pledged not to pull the line, now fully drawn, in bankruptcy. CIT tapped the $4.5 billion added to its credit facility to pay Goldman.
Q: So the $2.3 billion the Bush administration gave CIT under the Troubled Asset Relief Program just disappears?
Not exactly. CIT recently tweaked its restructuring plan so that the Treasury Department's preferred shares could fetch maybe $230 million once the company exits bankruptcy protection. But that's if taxpayers get really lucky, says Sean Egan, president of Egan-Jones Ratings, an independent credit-rating agency. Every creditor (and attorney) would have to get paid first before any of the preferred stockholders get a cent.
Preferred stockholders will get what are called "contingent value rights" in the planned reorganization. Their value depends on how the new notes and new common stock trade. If the new notes and new common stock trade at a level that exceeds the face value of the old notes over a 60-day period, then the Treasury gets value for the CVRs. That is, it has the right to new common stock.
Q: I read on the Internet that my common stock could rise in value once CIT is healthy again. Is that true?
No. Under the proposed plan, all existing common stock and preferred shares will be canceled when CIT exits bankruptcy, and existing bondholders will get nearly all of the new common stock. "I have never seen common-stock holders get anything from a bankruptcy in my 25 years," said Michael Gesas, a bankruptcy attorney at Arnstein & Lehr, in Chicago.
SUPPLEMENT NO. 1 TO AMENDED OFFERING MEMORANDUM, DISCLOSURE STATEMENT AND SOLICITATION
OF ACCEPTANCES OF A PREPACKAGED PLAN OF REORGANIZATION
CIT Group Inc.
&
CIT Group Funding Company of Delaware LLC
Offers to Exchange
and Solicitation of Acceptances of a Prepackaged Plan of Reorganization
http://cit.com/wcmprod/groups/content/@wcm/@cit/@about/documents/information/offering-memorandum-supplement.pdf
sounds good, thnx Joe...
No telling what is going on. I sold a little at .435 just to say I took some profits. I would proabbly sellsome more if it gets back up there. Not to say I don't think it will go higher. I just like to lock some in as the position grows and becomes a bigger part of my portfolio.
For now I just sit and watch and look around the trash heap for other ideas.
CITDQ. (cit.pc), $1.58, up $1.06, or 150%. Amazing.
CITBQ getting gobbled up today, any ideas Joe? Thanks
all i can say is they are better than commons
Hey guys
I've not played the Pfd's before, but, this is up 60% today, so there is something to it?
Sorry, just not familiar with Pfd
Did I mention how I got beat out of those 21's here yesterday, lol
I may never get over that.
I do have 24s
Yes, strange, but good for me. Went up to 1.75 which with the current price of CITGQ did not leave much profit, if any, from a conversion.
it spiked? wow
SOLD my 600 CITDQ's here for 1.60.
Dang! If I would have put my limit order (.63) in a little higher (like .65-.70) at the open I would have had several thousand shares instead of just 600 and would have had a very nice day.
But, $568 gain with commissions is better than a sharp stick in the eye.
Good information on iHub today, thanks all.
Just got off the phone with Schwab. They said they can not do the conversion until settlement date of Nov 10th since I just bought the shares today. After that it sounded like a quick process, although I had someone waiting on another line and forgot to ask EXACTLY how quick.
If it is voluntary I would bet the company would like at this point for as many as possible to convert so less is owed the preferreds.
Would this create even more selling pressure on the common?
For updates on this CIT C issue, see my posts on the CITGQ board. "Immediately" has different outcomes and time frames for different people based on who you use as a broker. Obviously, common share prices can move pretty fast in either direction while a company is in bankruptcy
JMHO DYODD GLTA
"Under the terms of the Company’s 8.75% Non-Cumulative Perpetual Convertible Preferred Stock, Series C (the “Series C Preferred Stock”), as a result of the delisting of the Company’s common stock, each share of Series C Preferred Stock is immediately convertible into 9.0909 shares of the Company’s common stock." Doesn't that imply that the preferred holder has to take some action to convert, but could choose to sell them on the open market instead?
"Immediately" has a process to go through and the shares no doubt would be halted if not legal. I would not question how quick the shares are issued, but how long.
Looks like playing with hotter fire than the commons or CITBQ and wondering if those trades out there this AM on CITDQ will be cancelled since they were supposedly all immediately converted to common shares earlier this week. Something is wrong. They are showing trades of 90 plus cents a piece on CITDQ...but are they real and will they be legitimate legal trades in the end?
JMHO DYODD GLTA
Well, I got a partial fill of 600 shares on my order at .63.
Now give me my 5454 common shares please...soon please!!
I was laying in bed last night and suddenly thought 'why is the CVR not known". Certainly they would have to be factored in and part of the plan they present to the court. They could easily say the preferreds will get warrants for such and such in such and such event.
Sure does seem like that should be the deal. Of course a discount for the uncertainty of when you would get them. I am going to try to buy some at the open.
I will let you know if I hear anything.
Straight from the SEC:
http://www.sec.gov/Archives/edgar/data/1171825/000095012309057703/y80157e8vk.htm
I've emailed my broker to ask how I would go about converting CITDQ into 9 CITGQ, but I may not get a timely response. If you get any better info from Schwab about how to do it, will you post? It does sound like CITDQ should be 9X the price of CITGQ, doesn't it?
http://biz.yahoo.com/e/091104/citbq8-k.html
I don't understand why the CIT C's are still trading if they were immediately converted to common upon delisting. That 8 K makes it look like what is trading for them are not "real" shares anymore. Dangerous situation now if you ask me about opening new positions. The A preferreds are "dangerous" too but they still exist right now as far as any 8K's out there show and should be less dangerous than the common shares. And the A's now have less competition for contingent value rights of CIT's left over piece of pie, to the tune of 550 million dollars LESS competition.
JMHO DYODD GLTA
I think CIT filing BK is the best way to go. The governemnt adding on more debt does not cure the problems that CIT has. The restructuring of debt uinder BK could put CIT back on firm footing. Unfortunately the common suffers the most, but the alternative is worse IMO. Under the current plan CIT will still be able to make loans to small businesses in the future. With a bailout I think their would always be underlying uncertainty if they have the ability to survive.
So, how does one get the 9+ shares for each CITDQ? If indeed you could convert immediately, you could sell that common immediately for a nice return.
I hold only the A's. Maybe I will buy 100 shares of CITDQ just to see how it works.
Do you have a link for that 8K?
Thanks
The Series C Preferred was removed from a preferred play upon fulfillment of that feature of conversion to 9 common shares.
From that 8K...
Item 8.01. Other Events.
Under the terms of the Company's 8.75% Non-Cumulative Perpetual Convertible Preferred Stock, Series C (the "Series C Preferred Stock"), as a result of the delisting of the Company's common stock, each share of Series C Preferred Stock is immediately convertible into 9.0909 shares of the Company's common stock. Due to the automatic stay in connection with the Chapter 11 Cases, the Company is prohibited from paying cash in lieu of any fractional shares.
The main preferred play is Preferred A series CITBQ since the Z is like a bond that's got a share price currently at about 70 percent of par (like alot of the bonds are looking to get in the proceedings) and the government's preferreds aren't really trading right now.
We continue to push for fair treatment of the remaining preferreds like we assume the government will push for fair treatment of their preferreds.
Removal of the C's frees up about 550,000,000 dollars
that had been in competition for money that was previously in consideration for the preferred's part of the company's "fair obligations".
Less competition for a given sector of that part of the company's money is nice.
JMHO DYODD GLTA
I try not to confuse wishes with reality, but I think they have to change new shares for old shares, there is no fire sale here as in the case of general motors, the debt does not exceed the assets.
Investors investing in motors liquidation wrong thinking that they are going to give something, and out of Cit thinking that they will not give anything.
Thanks.
Form 8-K for CIT GROUP INC
--------------------------------------------------------------------------------
4-Nov-2009
Bankruptcy or Receivership, Triggering Events That Accelerate or Increase a Direct
Item 1.03. Bankruptcy or Receivership.
On November 1, 2009 (the "Commencement Date"), CIT Group Inc. (the "Company") and CIT Group Funding Company of Delaware LLC ("Delaware Funding" and together with the Company, the "Debtors") filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Code (the "Bankruptcy Code") in the United States Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court") (the "Chapter 11 Cases"). The Chapter 11 Cases have been assigned to the Honorable Allan L. Gropper and are being jointly administered under the caption "In re CIT Group Inc. and CIT Group Funding Company of Delaware LLC" Case No. 09-16565 (ALG). The Debtors will continue to manage their properties and operate their businesses as "debtors-in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court.
A copy of the press release, dated November 1, 2009, announcing the filing of the Chapter 11 Cases is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Item 2.04. Triggering Events That Accelerate or Increase a Direct Financial Obligation or Obligations under an Off-Balance Sheet Arrangement.
Financial Obligations
The filing of the voluntary petitions for relief described in Item 1.03 above (the "Voluntary Petitions") constituted an event of default or termination event and caused the automatic and immediate acceleration of all debt outstanding under a number of instruments and agreements relating to financial obligations of the Debtors and certain of their affiliates (the "Accelerated Financial Obligations"). The Debtors believe that any efforts to enforce the payment obligations under the Accelerated Financial Obligations are stayed as a result of the filing of the Voluntary Petitions, with the exception of certain unsecured credit facilities to affiliates of approximately $284.1 million, certain transactions under various swap agreements, and certain aircraft and rail leases. The material Accelerated Financial Obligations include:
- the vast majority of the unsecured credit facilities and loans of the Company and its affiliates in the aggregate amount outstanding of approximately $4.1 billion;
- all of the senior unsecured notes issued by each of the Debtors in the aggregate amount outstanding of approximately $28 billion;
- all of the Company's subordinated notes in the aggregate amount outstanding of approximately $1.1 billion; and
- all of the Company's junior subordinated notes in the aggregate amount outstanding of approximately $750 million.
In addition, the filing of the Voluntary Petitions constituted a termination event under various swap agreements to which the Debtors and certain affiliates are party. The Debtors or their affiliates are entitled to receive net payments in the amount of approximately $236 million as a result of such terminations if all of the swap agreements are actually terminated. The amount of such net payments are estimated and are subject to change based upon pricing quotes received by the calculation agent and changes in market interest and foreign currency rates. If additional material Accelerated Financial Obligations later become calculable or known to the Registrant, information regarding such additional obligations is expected to be provided by a subsequent amendment to this Form 8-K.
The filing of the Voluntary Petitions constituted an event of default under certain aircraft and rail leases under which a wholly-owned subsidiary of the Company is the head lessee. The head lessee's obligations under these leases are guaranteed by the Company. In the event that the head lessor under each lease demands stipulated loss payments as a result of the event of default, the head lessee, or the Company as guarantor, would be obligated to make such payments in the amount of approximately $1.7 billion. However, as a result of such payments, the Company expects that it would receive title to air and rail assets from the head lessors currently valued at approximately $1.3 billion.
Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.
On November 2, 2009, NYSE Regulation, Inc. ("NYSE Regulation") announced that it determined that listing of the Company's (i) common stock (ticker symbol: CIT); (ii) 6.350% Non-Cumulative Preferred Stock, Series A (ticker symbol: CIT PR A); (iii) 8.75% Non-Cumulative Perpetual Convertible Preferred Stock, Series C (ticker symbol: CIT PR C); and (iv) equity units (ticker symbol: CIT PR Z), in each case on the New York Stock Exchange (the "NYSE"), should be suspended prior to the market opening on November 3, 2009. NYSE Regulation determined that the Company is no longer suitable for listing in light of the November 1, 2009 commencement of the Chapter 11 Cases by the Debtors which is sufficient grounds for the commencement of delisting procedures pursuant to Section 802.01D of the NYSE's Listed Company Manual. At this time the Company does not intend to take any action to appeal NYSE Regulation's decision and therefore, it is expected that the Company's securities described above will be delisted after completion by the NYSE of application to the Securities and Exchange Commission.
Item 7.01. Regulation FD Disclosure.
The Company guarantees approximately A$300 million of public debt issued by its subsidiary, CIT Group (Australia) Limited ("CIT Australia"). The Company and CIT Australia have reached an agreement with a majority of CIT Australia's noteholders to amend the terms of the debt including waiver of an event of default resulting from the Company's bankruptcy, grant of a first lien security interest in most of CIT Australia's assets to the noteholders, subordination of the intercompany notes owed by CIT Australia to the Company to the CIT Australia public debt and institution of a cash control process whereby certain cash is used to repurchase and retire notes prior to the maturity date. The interest rate on the debt remains unchanged and CIT Australia will not pay the noteholders any amendment fee.
Item 8.01. Other Events.
Under the terms of the Company's 8.75% Non-Cumulative Perpetual Convertible Preferred Stock, Series C (the "Series C Preferred Stock"), as a result of the delisting of the Company's common stock, each share of Series C Preferred Stock is immediately convertible into 9.0909 shares of the Company's common stock. Due to the automatic stay in connection with the Chapter 11 Cases, the Company is prohibited from paying cash in lieu of any fractional shares.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits:
Exhibit
Number Description
99.1 Press Release dated November 1, 2009.
Forward-Looking Statement This document contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All forward-looking statements (including statements regarding future financial and operating results) involve risks, uncertainties and contingencies, many of which are beyond CIT's control, which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. All statements contained in this document that are not clearly historical in nature are forward-looking, and the words "anticipate," "believe," "expect," "estimate," "plan," and similar expressions are generally intended to identify forward-looking statements. Economic, business, funding market, competitive and/or regulatory factors, among others, affecting CIT's businesses are examples of factors that could cause actual results to differ materially from those described in the forward-looking statements. More detailed information about these factors are described in CIT's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2008 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2009. CIT is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
Thanks. Good suggestion.
From the Yahoo board. There was a campaign to get Senator Dodd to remember what he said this summer, specifically, "the Federal government should provide assistance to help CIT Group avert bankruptcy." He said that publicly around July 23, 2009.
He is running for re-election now and you would think as Chairman of the Senate Banking Committee that he could have talked those with power into seeing how a little help could go a long way with CIT Group.
From the Yahoo CIT board...
Senator Dodd said what he said this summer and his political career is on the line with this one.
The people of Connecticut will not forget throwing the small business generator and unemployment reducer CIT Group to be devoured by the CDS placer carnivorous wolves that look as though they almost set CIT Group up to fail before, GET THAT, before the government gave it a 2.3 billion dollar TARP start of a lifeline. Front running of another ilk? We will see. They need to follow through with more effort. That was just inhumane to start and not finish the bailout and forced board and CEO change that usually comes along with that kind of help.
Senate Banking Committee
Christopher J. Dodd Chairman (D-CT)(202) 224-2823
Please follow through with the CIT assistance mentioned July 23, 2009 by your honor as fast as possible. The government should use their various avenues including, but not limited to, TARP Recycle, TLGP, Fed backing, FDIC guarantees, Fed discount window, or many other possible avenues. This company only needs a "small" amount of assistance. Please move quickly because they are initiating an action right now which is tantamount to the outcome that a bankruptcy would have and their other presented alternative is a bankruptcy. There is essentially very little difference as far as the outcome for the current shareholders, including I believe, the government's TARP shareholder investment. CIT Group is known as THE small business lender and most of the jobs in this country are in the small business sector. Thank you.
Senate Banking Committee
Christopher J. Dodd Chairman (D-CT)(202) 224-2823
Richard C. Shelby Ranking Member (R-AL)(202)224-5744
Tim Johnson (D-SD) (202) 224-5842
Jack Reed (D-RI) (202) 224-3542
Charles E. Schumer (D-NY) (202) 224-6542
Evan Bayh (D-IN) (202) 224-5623
Robert Menendez (D-NJ) (202) 224-4744
Daniel K. Akaka (D-HI) (202) 224-6361
Sherrod Brown (D-OH) (202) 224-2315
Jon Tester (D-MT) (202) 224-2644
Herb Kohl (D-WI) (202) 224-5653
Mark Warner (D-VA)(202) 224-2023
Jeff Merkley (D-OR)(202) 224-3753
Michael Bennet (D-CO)(202) 224-5852
Richard C. Shelby Ranking Member (R-AL) (202) 224-5744
Robert F. Bennett (R-UT)(202) 224-5444
Jim Bunning (R-KY)(202) 224-4343
Mike Crapo (R-ID)(202) 224-6142
Mel Martinez (R-FL) Resigned, I believe.
Bob Corker (R-TN)(202) 224-3344
Jim DeMint (R-SC)(202) 224-6121
David Vitter (R-LA)(202) 224-4623
Mike Johanns (R-NE) (202) 224-4224
Kay Bailey Hutchison (R-TX)(202) 224-5922
House Committee on Financial Services
The Committee oversees all components of the nation's housing and financial services sectors including banking, insurance, real estate, public and assisted housing, and securities. The Committee continually reviews the laws and programs relating to the U.S. Department of Housing and Urban Development, the Federal Reserve Bank, the Federal Deposit Insurance Corporation, Fannie Mae and Freddie Mac, and international development and finance agencies such as the World Bank and the International Monetary Fund. The Committee also ensures enforcement of housing and consumer protection laws such as the U.S. Housing Act, the Truth In Lending Act, the Housing and Community Development Act, the Fair Credit Reporting Act, the Real Estate Settlement Procedures Act, the Community Reinvestment Act, and financial privacy laws. Click here for a more detailed description of jurisdiction by subcommittee.
Chairman Barney Frank represents Massachusetts' Fourth Congressional District. The other Democratic members of the Committee are:
Rep. Paul E. Kanjorski, PA
Rep. Maxine Waters, CA
Rep. Carolyn B. Maloney, NY
Rep. Luis V. Gutierrez, IL
Rep. Nydia M. Velázquez, NY
Rep. Melvin L. Watt, NC
Rep. Gary L. Ackerman, NY
Rep. Brad Sherman, CA
Rep. Gregory W. Meeks, NY
Rep. Dennis Moore, KS
Rep. Michael E. Capuano, MA
Rep. Rubén Hinojosa, TX
Rep. William Lacy Clay, MO
Rep. Carolyn McCarthy, NY
Rep. Joe Baca, CA
Rep. Stephen F. Lynch, MA
Rep. Brad Miller, NC
Rep. David Scott, GA
Rep. Al Green, TX
Rep. Emanuel Cleaver, MO
Rep. Melissa L. Bean, IL
Rep. Gwen Moore, WI
Rep. Paul W. Hodes, NH
Rep. Keith Ellison, MN
Rep. Ron Klein, FL
Rep. Charles Wilson, OH
Rep. Ed Perlmutter, CO
Rep. Joe Donnelly, IN
Rep. Bill Foster, IL
Rep. Andre Carson, IN
Rep. Jackie Speier, CA
Rep. Travis Childers, MS
Rep. Walt Minnick, ID
Rep. John Adler, NJ
Rep. Mary Jo Kilroy, OH
Rep. Steve Driehaus, OH
Rep. Suzanne Kosmas, FL
Rep. Alan Grayson, FL
Rep. Jim Himes, CT
Rep. Gary Peters, MI
Rep. Dan Maffei, NY
Republican Members
Rep. Spencer Bachus, AL
Rep. Michael N. Castle, DE
Rep. Peter King, NY
Rep. Edward R. Royce, CA
Rep. Frank D. Lucas, OK
Rep. Ron Paul, TX
Rep. Donald A. Manzullo, IL
Rep. Walter B. Jones , NC
Rep. Judy Biggert, IL
Rep. Gary G. Miller, CA
Rep. Shelley Moore Capito, WV
Rep. Jeb Hensarling, TX
Rep. Scott Garrett, NJ
Rep. J. Gresham Barrett, SC
Rep. Jim Gerlach, PA
Rep. Randy Neugebauer, TX
Rep. Tom Price, GA
Rep. Patrick T. McHenry, NC
Rep. John Campbell, CA
Rep. Adam Putnam, FL
Rep. Michele Bachmann, MN
Rep. Kenny Marchant, TX
Rep. Thaddeus McCotter, MI
Rep. Kevin McCarthy, CA
Rep. Bill Posey, FL
Rep. Lynn Jenkins, KS
Rep. Christopher Lee, NY
Rep. Erik Paulsen, MN
Rep. Leonard Lance, NJ
The above should give you some places to start with your efforts too.
JMHO DYODD GLTA
White house press release says they will be monitoring "their" stake in the CIT Group.
NOVEMBER 3, 2009, 1:42 P.M. ET White House Notes 'Stake' In CIT Bankruptcy Proceeding Article Email Printer
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By Maya Jackson Randall
Of DOW JONES NEWSWIRES
WASHINGTON (Dow Jones)--The White House clearly has an interest in how CIT Group Inc.'s bankruptcy plays out given that taxpayers have provided the lender billions of dollars in financial aid, the White House said Tuesday.
"There's obviously a process that will now be ongoing in terms of their planned bankruptcy, but obviously, we have a stake in how that comes out as taxpayers have invested that money," said White House spokesman Robert Gibbs in a press briefing Tuesday.
CIT, which filed for bankruptcy protection on Sunday, has received $2.3 billion in funds from the Troubled Asset Relief Program, or TARP.
In response to a question, Gibbs said the White House is "heartened" by the fact that CIT, which lends to small- and medium-sized firms, will continue to lend.
He added that the Obama administration plans to continue to take steps to protect the economy.
"We will continue to seek ways to stabilize the financial system," he said.
In response to another question, Gibbs said the best way for the Obama administration to deal with the budget deficit is to get the economy moving again. "That's what the economic team is focused on and that will have the most impact in the short term," he said.
-By Maya Jackson Randall, Dow Jones Newswires; 202-862-9255; maya.jackson-randall@dowjones.com
http://online.wsj.com/article/BT-CO-20091103-714082.html
JMHO DYODD GLTA
institutonal ownership is still high
I wonder what they are waiting for?
FWIW, >>>What Does Contingent Value Rights - CVR Mean?
A type of right given to shareholders of an acquired company (or a company facing major restructuring) that ensures they receive additional benefit if a specified event occurs. A contingent value right is similar to an option because it often has an expiration date that relates to the time the contingent event must occur. Investopedia explains Contingent Value Rights - CVR
For example, shareholders of an acquired company may receive a CVR that enables them to receive additional shares of the target company in the event that target company's share price falls below a certain level by a specified date.
Another example of a CVR would be for a target company to set aside a large sum of money that would be transferred to the shareholders of the acquired company in the event that the price of the target company's shares do not meet a certain target or fall below a specified price. <<<<
My thinking is that CIT will not go to the preferred shares holders and offer 1 penny for every $1.00 in preferreds you hold. I think there will be some kind of option or warrant that has value in excess of 1 cent.
ha! you got mine lol I'll keep fishin
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Cit Grp. Pfd A (CIT-A)
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