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Just checked and I can add to my position through TD Ameritrade. I was upset with TD Ameritrade a few years back and switched to Think or Swim and now TD Ameritrade bought them. I was planning on moving that it to Interactive Brokers but MF Global has slowed my movement on that. Maybe my Fido account goes to Int Brokers and I keep TD Ameritrade.
Does anyone know of a good platform to get quotes/buy secondary bonds? I know as a private investors I'm going to get screwed but looking for any advice. Zions has been recommmended to me and I have an account there and they have been adequate but not great and looking for other options.
Thanks for the amazingly fast answer. I own it in a different account that I don't wish to make a larger % of that portfolio and would like to own it in these accounts.
Wonder if I could get a list of other stocks Fido has on the same list and see if there are any other mispricings out there to take advantage of.
Frustrating/ed. Tried to buy some in my wife's IRA. Of course since she owns none (what we own is in my accounts) they state:
Strange. Really strange.
I wonder if this means that the Art and Rosen heard from THJMW of her findings and POR 7 doesn't address her anticipated ruling and therefore she wants a settlement so that the POR doesn't have to materially changed.
Linda-
There is also language that states that the amount to class 16 is $250M. Questions indeed.
Can someone help me out on this?
On page 47 it states that 'assuming an effective date of February 29, 2012 the maximum possible recovery for holders of Allowed PIERS claims is approximately $250,000,000"
Yet earlier on page 45 it states piers are getting 9% of the initial claim of $789. my math says 9% x $789M is only $74M.
These are both referencing the same basic math as even note (j) in the Liquidation analysis in Exhibit C: Liquidation analysis refers to the $250M and not the $74M.
Lastly, if DIMEQ wins and is placed in Class 12 is WAHUQ still at 9% ($74M) or are they now a $0? This is a crock of shit if WAHUQ goes to $0 and preferred gets something even if DIMEQ wins.
Additionally, reading footnote #24 on the bottom of page 45 they refer to $375M of general unsecured claims (Class 12) as more to flowing to WAHUQ if it is indeed less. Does anyone have any thoughts on if the $375M (now $402M with interest) is likely to be real?
only skimmed it this morning. Will read more during a conference call in a half-hour. Damn job!
Chevy's math is the same as mine. This is interesting case as equity was arguing that the value of the NEWCO was many multiples greater than the debtors value of the business. In the end the debtors valuation should help them short term but allow long-term holders who believed the Equity analysis to pick up $1.00 for a quarter now and maybe into the future.
Surprised to see that it hasn't moved more this morning. Second, need to figure out what happens if DIMEQ wins.
Good trading to all.
As we all know buying BCONQ at this point is gambling on a lotto that is hoping the asset sales bring back more than what they owe to the DOE. At that point anything over $45M should go to shareholders assuming its a complete sale of the company (I don't think they will be able to sell the plant to continue to go it alone, nor should they) as they need funding.
Here is part of an email I got from a guy who is a notorious bear on BCON so take it for what its worth.
Short covering on AMR sure. but commons being kept in an airline BK, yeesh.
If you are long for a trade on momo - good luck. If you really being the commons are going to survive - throw the rest of your money in a toilet, it will save you time.
Absolutely nothing that I am aware of. Seems pure momo. I cannot see how it doesn't get cancelled eventually in 18 months. The only news I see other than the mgmt shakeup (which is good imo) is a codeshare deal with a tier 2 airline in china. (Max revenue kicker to the company is maybe $10M annually.
I just saw this as well. Was is the codeshare with Hainan? Really a second tier player in China somehow negates the bankruptcy?
Jeezus-
I cannot see the bk court approving this. Gambling with their salaries just in a hope to make a save a few bucks. This must mean their cash on hand is even less than they thought/ or they are burning through more and need to conserve cash.
Now I am waiting for news that they haven't paid the employee taxes, etc. I've only seen this once before in a BK and it didn't end well.
Let me guess. Your math consists of taking your shares of WAMUQ x whatever price gets you to be a millionaire. That means you have about 42,000 shares, using an average price paid of $.10 you put about $4,200 into it.
I tried to get a get a recent quote on the CUSIP. No transactions in the last year per FINRA. The last trade was in 2008 on the Senior at 10 or $100/$1000. That is worth about $.09/share or what we were trading at.
I found that there was $79M of senior bonds issued initially and $103M of junior bonds. I have no idea if that is still the amount but I am going to assume so.
Lets say after liquidation there is $20M left (yeah!) The $20/$79M is worth about 25% of face so we'd get $687k divide by 3M shares and were worth $.22. Doing the math on this makes me want to sell @ $.30 if I could.
Oh yeah, I forgot. I've been trying to find out a little color on the type/date of the bonds that LSRAF holds on Trenwick America. Well, Trenwick has two levels of bonds out; a Senior Bond due 8/15/2012 and the junior bond due 2/15/2013. I'm trying to find out how many total senior bonds were issued by Trenwick to see how much debt they have. The CUSIP I have on the Senior bond is 895285AC8, junior bond 895285AB0.
I didn't see it was only on 100 shares until later. Stupid me I know on these I should check first.
I wonder if there is some gamesmanship going on with some holders of illiquid securities as I've noticed a few stocks that are pretty illiquid (DIMEQ another one) that had a big tick up at the EOD on low volume and wonder if someone is juicing the share price so they don't have a margin call.
Dang your post on here and the share price got me excited. Nothing on the sec website. Last Jan. When I talked to the guys who is trying to sell our bonds he was hoping for a resolution in 2011, but was not going to promise anything.
I'm not sure where the $10B number came from as I haven't been through the last Q or any of the BK filings yet. As of Q2 they were $8B underfunded for the PBGC calculations which require 100% funding.
Add in the fact while UA and US in the early 00s used BK to shed their pension obligations both NW and DL did not. In fact the combined entity currently has a pension shortfall of over $11B to bring it up to 100% funded.
I'm not so quick to think there may be no value here. I'll probably be buying some other secured bonds that are not tied to any airframes.
I completely agree that Eagle is going to take a huge hit.
Going into BK - the company was offering the pilots 3 and the pilots were countering 7%. Wages were already competitive with DL, and United/Continental for the most part.
I've not seen the unfunded liabilities as that high as their pilots have an A/B scale since the early 90s IIRC.
The other groups; mechanics, FA, gate agents, ramp rats don't really matter as they will take what they get for the most part. They will make some noise but my guess is that their salary isn't going to change much but there will be major work concessions that the average Joe Fueler won't see or understand.
Fleet decisions were already made this summer with the announcement of Airbus and Boeing order and we know what they are going to dump. Going from a 100% boeing shop proably cost them 10% from Boeing so you know they got a good deal from Airbus. A major sticking point with the APA (not ALPA) which will throw an interesting dynamic into this BK is who fly's the 70 and 90 seaters to replace the MadDogs and the 145s.
I need to find a list of who owns what planes as my gut tells me that they should almost own all of their old airframes but I've seen reports that they have leases on some of the MD80s out until 2024 which seems insane.
I agree that right now its early as I don't have a position but Delta and NW's bankruptcies are probably a good proxy. I don't think they will kill all their unsecured creditors as the airlines business is incestous.
Agreed, but one can use DAL and NW bankruptcies as good examples of what eventually happened.
Yeah, I think the secured will get paid. Notice that these guys went in without DIP financing as nowdays BK doesn't affect future bookings like it used to.
Seeking this seem to settle at 16% (4/25) this could be interesting. Need to do some research on what happened with DL and NW when they went BK ahead of pension payments just like AMR did.
My expectation:
Employees - Wages will not cut much, new employees (Pilots) are already on a B scale but work rule changes.
They are going to dump the 762 fleet (why they have been using these as domestic transcons has been stupid. Quicker retirement of MD-80s and my guess is a net reduction of 75 planes from service.
American Eagle will get destroyed as AMR will use this to cancel their agreement with them due to their high market rates and they hold the leases on the EMB-145s (50 seaters). They will hire some other regional and due to scope change with pilots will add 70 seaters.
Hubs-
DFW and MIA fine. I expect shrinking in ORD and LAX.
After BK - They will try to buy B6 and AS.
This may be an interesting play as they are using the DL playbook, imo.
That said, there is basically two ways in my opinion to play this.
1. Figure out who owns the leases on their 50 seat regional jets, MD80s and 767s. Short them if you can. I doubt it as my guess is they are owned by boeing, ILFC (was owned by AIG a few years ago), EMB, etc. Some Hedge funds and large insurance companies may own some as well.
Note: I interviewed with a PE fund back in 2007 to work in their A/C leasing division (they most bought used AC and sold them to Latin American and Africa and some Asia) and was shocked at how they didn't know the real risks of their business. After the initial interview I told them I wasn't interested (I was planning on moving out of the NY area anyway (wife).
2. You can buy companies like Boeing, Embraer, Bombardier (new C-series) hoping that they score a major order. I find this very unlikely as AMR already made huge fleet decisions this summer and bought Airbus and Boeing. While they may be some acceleration of delivies, not sure if its possible as I haven't looked at their order books, these companies may have leasing losses as well.
3. Buy some basket of regionals who may benefit if AMR lets Eagle take the 50 seaters and shuts them down and buys/leases 70 seaters from someone else. Players here include Skywest, Pinnacle, and RJET. My favorite here is RJET. Their CEO has talked about shutting down the Frontier Brand business as its hemmoraging money, he's from their regional ops side and AMR could get more smaller newer fuel efficient planes from them quickly at market rates.
That said, I am not as up to date with whom is flying for whom and when their contracts are up and who owns the planes of these regionals. (This is what you need to know).
4. The last option would be to buy bonds of AMR hub airports if they took a hit. I haven't looked at it but after 9/11 (different situation) but bonds for ATL airport sold for 27. Buyers had a full recovery within a year and got paid a 40% yield. I'd be a buyer of DFW and MIA but not ORD or STL at this time.
I've used to be critical of pilots and still think many of them have an inflated ego of themselves and their jobs but overpaid is not one of the things you can call them anymore. Add in the fact that being a regional pilot was supposed to be a 2-3 year gig and you've got guys there 10-15 years and its a career. Our regional pilots make less than pretty much anywhere in the world. At some point you are going to start seeing pilots head to Asia for better pay vs the US even if the seniority/protection isn't there. Europe, especially Britain has been sending pilots to the MiddleEast for 20 years and Asia is just starting to ramp up.
The amount of time and training they put in upfront doesn't provide a good ROE. That said, I blame much of this one the greed of their union, ALPA which is the union for almost every pilot in the US except for American. The airline plays two groups (regional and majors) against themselves and ALPA lets it happen as the growth of regionals grew the # of total pilots which meant more fees for them. Airline mgmt can leave (I did) when times are bad but pilots are stuck for life to an airline due to seniority. If their union had balls they would create a national union with national bidding every five years so that each pilot would bid based on their rating type and seniority and be able to compare which option is best for them (higher base pay/worse benefits vs other options).
I doubt it you could live on their monthly salary for a year. What do you think it is?
AMR pilots hourly pay is basically in line with their other competitors (DAL, United/Continetal) and all pilots hired since the early 90s have been on a "B" scale in regards to contributing to their pension.
A narrowbody FA is probably around $110k -$125k and to get there he will have had to either be in the military for 6 years or college with serious debt ($80k for Embry Riddle), and then 2-3 years of sub $20k at a local airstrip to get his hours up to get a ride with a regional at $28k starting for a 50seat jet and a captain in the $45-80k range. Its not like it used to be.
http://blogs.wsj.com/middleseat/2009/06/16/pilot-pay-want-to-know-how-much-your-captain-earns/
What they will see in their new contract will be similar wages, remember that AMRs last offer was a 3% rate increase vs the APA offer of 7%. I would expect to see the 3% but reduced scope clause allowing regionals to fly 70 seaters. AMR was going to spin off Eagle earlier as they were paying above market rates. This BK filing will affect them more. Expect to see new regionals on the ground flying 70 seaters, accelerated shedding of the MD-80 fleet (already planning with the massive Airbus/Boeing order announced this summer) and a net reduction of 50-75 planes. The 757s w/ winglets which they should scrap due to age will probably hang around and replace their 762s flying domestic transcons. Getting rid of the 762 fleet could be worth hundreds of millions annually to the company. I would expect a drawdown of planes to kill whatever is left of St. Louis, further shrinking of Los Angeles, and hits to Chicago. Chicago will be brought back up eventaully with the 70s that will hit but there will be a timing disconnect.
We are. It was supposed to be out there on November 15 and wasn't out there on the 17th. I did pull it and have sent a copy to EI and Chevy. There is no material changes from prior info which is not surprising.
With a trustee managing this thing I would doubt there would be any actuarial adjustments made mid-year as its probably not worth the time and cost mid-year. Looking forward to the YE report to see if we have any reserve relases which should free up some cash. We are now at 11 years since they wrote policies so you would hope lots of this could be closed.
My expectation is that nothing can move forward until there is settlement at hopefully a discount with regards to Granite. Once that happens I would expect that they would sell the remaining book to someone else @ a discount. Unfortunately I think that nothing happens here materially until Granite is resolved.
The plant by Beacons own estimate as of the October BK filing was that its 98% complete. That is the reason that they filed the BK, they felt they had the right to access their own monies that were held ($3M) and had access to the last $4M of the DOE loan to finish items.
The plant is fully operational but they have had 2 flywheel failures out of 200 in operation so part of it is determining the failure items, making tweaks to improve operational efficiency and other punchlist items. So are all the 20MW installed and operating? Yes.
But they still have some stuff to finish, fix, improve.
I posted my thoughts on another board both initially when the rumors started up and again this morning. I am shocked by this. From an employee morale perspective this is a horrible time. Their pilot pay is competitive on a per hour basis but I believe they have some antiquated work rules that need to be cleaned up. They already have a two tier pension plan so that should be a small issue going forward.
Simply put there is no reason to do this before January. I feel bad for the employees who while it will be business as usual will have a right to be concerned. Long term it should allow AMR to shed some older leases, but frankly they owned most of their fuel hogs, and already had orders to replace them with new fleets which would help in this fuel $ enviroment.
I had bought some March 2012 calls thinking that a resolution would be announced to the pilot agreement after the holidays. They are now worthless and so will the commons.
Wow was I wrong. Its a very intersting BK for AMR in that there is no DIP financing as it will be self financed. It also appears that the board and not Arpey pushed this evidenced by his firing.
It also doesn't appear to simply be a way to get concessions (mostly around the pilots) but this will help in it as the union will not want their pension to go to the gov't PBGC.
I completely mistook the agressiveness that AMR wanted to play with its A/C lenders. My take was that due to the age of their fleet and the fact that they owned a lot of these older planes there would not be a lot to gain in filing bk to shed these assets via a leasor.
I don't disagree with what they hope to get out of this. I simply expect that in the end they will end us selling themselves along with the plant to someone as I cannot see them selling the plant for $45-50M plus a service contract which is what they will need to continue as a stand-alone business. At that point this will turn into a simple liquidation which removes some of the long term upside but for traders it may be better in the short term.
To add on to the great posts by Wall Street and the Grudge can I ask a simple question on the preferreds. (FD: I don't own any)
So when I went back and looked at Class 18 which lent me to Class 19 the REITS. The current settlement for the REITS is for $50M out of a FV of $4B? This would imply a recovery of 2%. I also have in my notes that if in the case of a payout it would be revised to be Pari-passu with the preferreds.
So not only for the preferreds to get paid one would expect the REITS to get something more as well. I know that in mediation all fair in love and war and anything goes but am I wrong to think that the guys on the preferreds way out touch with any possible recovery. Right now the P's are trading at 2% or equal to what the REITS are receiving. So while the FV or the preferred is $3.5B when you add in the REITS the preferrreds have to find $75M for 1% change.
Right, wrong, crazy or should I just not read those boards as you'll go blind from stupid. BTW, Blazing Saddles > Pulp Fiction but Animal House is better than either.
Robo- What other projects are you talking about?
There is a $24M grant (not a loan) for PJM in PA that they have had out there for a while now with a $5M grant to build it. They have been unable to find someone to JV this with them.
*****************************************************************
The original estimate of the Stephenstown plant was to be in the $60M range of which I've been told just to buy the power inverters and connect to the grid 20mW of power is worth $10-$25M at a minimum.
I think people need to realize that the sale in Jan is going to sell the entire business (staff, plant, IP) as no one will simply want the plant other than the value of the inverters/connection which ties to the $12M number. They need the people and entire staff's knowledge to make it work and the buyer needs to have the pockets to build multiple plants (3-4/year) and understand the ROE. That said the estimates are kind of wonky as the FERC ruling which is good for them still doesn't give us an idea of what revenues from these plants could be and will not be known until after the auction.
Its worth a flyer but not much more at this time imo. If anyone has a copy of the full FERC statement plus tariff pages I'd be interested for a link.
Jesus guys. Calm down. Think of this as a strange neighborhood corner bar where everyone rushed off to after Sunday church to watch the 12:00 NFL game.
If you would get punched in the mouth for saying something then don't say it here.
I appreciate what Wall Street has brought forward. I never considered Class 18 and was solely focused on class 12. Him even bringing it up has caused me to read a lot of documents late at night to try and see the other side better.
My speculation is that hes a guy who is long who enjoys tweaking other longs during this process and maybe shakes out some cheap shares for himself.
Was originally scheduled for next wednesday the 23rd but with Rosen's reply and this delayed a week I was expecting this to get pushed as well. Add in its right before TurkeyDay and I don't know if the date sticks but I've seen nothing that changes it.
Linda-
The Piers chart that your are referencing I think if I am looking at the same one was 32% (minor quibble). However that amount is assuming that at the current time while the amount for the Dimeq is the $337M it currently sits down in class 20. Therefore if it gets moved to class 12 then 32% goes to pretty much zero.
Many people, myself included thought that an FJR ruling would increase the value to WAHUQ. Luckily I was out of the stock as I felt the share price was close to full valued based on POR and delays for implemention and TVM and felt there was better opportunities elsewhere (DIMEQ).
The only strange part to me with regards to the WAHUQ security is the stock cratered when someone realized that any recovery would be lost to SNH and the stock cratered about $500M or close to the value that would be lost to SNH, however Senior notes also dropped by $500M of notional value on the FJR ruling. One of these is wrong as the market stated the WAHUQ would have to pay back the SNH per their contractual terms but that the SNH would not get the money. A strange disconnect in my mind.
As someone very intimate with this industry and how it negotiates this will take a while to fully play out I believe.
The keys to be aware of here are:
1. When are the debt payments due. (like any BK looming)
2. Cash balance (like normal)
3. Future aircraft orders and obligations.
4. Seniority of workforce (pension issues and potential gov't intervention - they don't want another
Also to note that AMR and formerly Northwest have the worst labor relations in the industry (outside of Spirit ;)) That said most pilots belong to ALPA wher APA only represents AMR pilots. This is good/bad for the pilots. They probably don't have the finances to really strike but they also don't have to worry about how their contract will aftect ALPA pilots representing regional carriers. Its just about them.
Looking at some lists of Airline Pilot pay their rates are right in the pack so my guess of the industry is in the work conditions section. American has some old contract terms that make scheduling very inflexible and cost them considerable money in the amount of reserves needed and the inflexibility leads to operational issues which is where the real money savings are.
My guess is AMR is pretty senior so the senior guys will agree to lower pay to maintain their pensions (BK would turn it over to the gov't and be shrunk between 20-80% IIRC for United). Also of note AMR used to play up the fact that they had never filed BK but Gerard Arpey has stated that they would have been better off in the mid 2000s if they have so he's clearly willing to play that card.
My guess is they ultimately settle after the Holidays for 3% raises, with worse work rules and new hires get worse benefits but since they have not been hired they can't vote against it.
FD: I recently bought March calls.
Simple Question:
I was reading up on different classes in teh POR #6 trying to keep up on the DIMEQ saga (Art's response to Rosen should be out tonight) which are always a good read. Not Old Man and the Sea good but better than Twilightand good for this legal stuff.
So I got to the WAMU Piers (class 19) and reading it surprised me as I completely forgot about it.
Do I have this right? The settlement for the REITS is $50M out of a FV of $4B? This would imply a recovery of 2%. I also have in my notes that if in the case of a payout it would be revised to be Pari-passu with the preferreds. Do I have this right?
So let me ask this a different way? FV for preferreds is $3.5B. If they were to settle on 10% that would be a payout for P's of $100/share. This would be $350M that they would have to "find".
My understanding that while in mediation the absolute priority rule nor the settlement with the REITs absolutely have to be followed and applied but but lets say it did. That mean that the REIT holders would get 10% of their claim or $400M which means that in reality they would have to find, clawback, etc $750M just to get 10% to preferreds. 20% - $750M more and on and on.
Now I realize that in mediation it all gets thrown out, but I doubt REITS would walk away with 2% while preferreds get 10 or 20%.
Right, wrong, crazy?
Phillips point is simply in the absense of news stocks that are event driven tend to decline for many reasons
a) investors looking for a catalyst stay away
b) forgotten
and on and on.
Add in the fact that in theory every month delay eats up a part of the estate in legal fees and interest and it simply makes sense for the chart to slowly grind lower. We all know that but it doesn't make one happy. However the announcement of a settlement should move the shares to damn near that value almost immediately, therefore one has to be in it to win it.
just noticed the D flailing on the ground. Then I looked at the helmets and it made sense.
That said he was an amazing back but too old for me to remember it.
Well if you're playing the Vikings, yeah.
Go Pack Go.
Sorry, will go head to the corner.