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I think you'll be fine as far as CODI in BBEP. The BK process might go on for a while for BBEP since it is likely in the interest of Unsecured Creditors to drag it out. Perhaps it's also in the interest of second Lien. Management just got out last month so you better believe that they will make sure that the allocation is done properly.
LINE might be a little bit of an issue.
"CODI may arise in the same calendar month of the closing of the settlement agreement with certain senior secured second lien holders during the offering period; amounts will likely be only a portion of the total potential CODI"
For example:
• April 4, 2016 - LINN entered into a settlement agreement with certain holders of its senior secured second lien notes, some amounts of CODI may arise upon the closing of this agreement."
So you sold in April...not good.
But the good news is that when the Pre-pack BK was done they were unable to negotiate a deal with second lien so I read somewhere that it reverted back to unsecured. I'm not positive about that...think I read it in SA so you might want to look into that so your mind can be at ease. If it was reverted back then no CODI.
If you had LNCO shares it is a c-corp so no worries.
http://files.shareholder.com/downloads/LINE/1771127700x0x889270/3AA043BC-7A18-4637-9F10-BF623829631B/S-4_FINAL_Slides_04_26_16_v3.pdf
I couldn't in good conscience say nothing.
BK is complicated and there are a lot of conflicting opinions but based on the Presentation by LINE and the actions of management within BBEP and LINE the CODI is a very real and dangerous proposition.
Who Knows maybe these flippers have kids and a family to take care of...you can't just sit back and not say anything. It's like watching someone choke to death without calling 911.
what are you trading with $200.
hopefully that's all you've got in it...cause the IRS will be knocking if you have any substantial amount in here.
If you file taxes you don't want to own partnership units during the month when debt is discharged.
CODI.
These are not shares of a C-corp
They are units of a partnership
The only way you can get out of your tax burden as a partner is if you file BK too.
Even if you hold for one day during that month when the debt is discharged you will see your share of the tax burden.
Go look into it and decide for yourself if you think it is worth it.
There is lots of dead cat bounces to trade where you will not get killed by the IRS.
Just food for thought.
People don't want to listen. Who knows what will happen with the CODI. So why not be long via the unsecured bonds...if at all.
It is just not worth the risk.
I'm starting to think that there are a lot of people here that are only working with a couple of hundred dollars so it will not affect them. Just penny flippers in their parents basement. That's not a dis actually, I wish I started learning about the markets when I was a teen.
Anyway the CODI might not affect the penny flippers or people who don't even bother to file tax returns.
I've got about 65k invested in 580k of par on the unsecured so this BK process has real consequences for me. If I put that kind of cash in the common I might as well play Russian Roulette.
Yeah, that's not my game. I figure that's why most are here. I'll let y'all do your thing.
the common has no value. Actually negative value. You will be crushed.
Massive volume on 2020 & 2022 bonds.
8 million of face traded today.
the bid side is loaded.
They don't have shareholders it's unit-holders.
In BK being a unit-holder can be devastating.
Buy the bonds.
just call your broker they'll tell you where to find them on their system. If I were to buy them now I'd have to talk to a rep anyway since they are in BK.
Bonds have doubled in value since ch11 fileing
the bonds are at 14 cents on the dollar.
$140/$1000 face.
I bought them a while back at a cost avg. of about 8 cents on the dollar but I also had to pay accrued interest so my final cost avg. was about 12 cents on the dollar.
You would not have to pay the accrued interest when they have already defaulted so you would almost have the same cost basis as I do.
I'm trying to say...management... they could just have not sold and their stock would be worth whatever it is at the end of this process. There is a reason that they are falling all over themselves to sell as much as possible before the end of the month.
Common is the lowest on the totem pole in restructuring. in BBEP's case. there is 3 bil of notes and 1/2 billion of preferred value above the common.
I'm not the best trader. I prefer strategic distressed assets. You may need lots of patients with the bonds. They may not be the best for you because they do tend to have a wide bid/ask and they are at times very illiquid.
The bonds will be the new equity.
And they are dirt cheep. If your a long term investor there is a lot of value there.
scare tactics by whom?
why has management dumped over 1 million units in the past 10 days?
http://files.shareholder.com/downloads/LINE/1771127700x0x889270/3AA043BC-7A18-4637-9F10-BF623829631B/S-4_FINAL_Slides_04_26_16_v3.pdf
True. Very True Actually. I've seen a lot of errors in SA articles. A lot! But the one that the Asian guy wrote which I've posted is very well thought out and documented. I simply think given that analysis and the fact that they are in BK the Bonds are a better risk reward.
Frankly I hope there is plenty of residual value to the units...that would mean that I'd get approximately par on the bonds. about a 10X return from my cost avg. So we're on the same team in a way. I just hope that if you're not a flipper and you intend to hold... you are aware of the CODI risk.
I owned a 50k units at one point and swapped it out for 600k face of unsecured.
you're a penny flipper. It's a game I'm not good at. The bonds are an easy no-brain way to make money. I'm sure you are a far better trader than I am and you know exactly what you're talking about.
http://seekingalpha.com/article/3978313-consider-breitburn-energy-partners-bonds
http://seekingalpha.com/article/3978353-breitburn-energy-get-burned
The bonds are still at a good risk reward even though they have moved from 60/1000 to 130/1000.
perhaps your correct. it is a complicated issue. it is not worth the risk for me. I'm not a day trader. That's why I own 600k of the bonds.
Why would someone want the units over the bonds if they are not a day trader?
Look up CODI.
I'm not a day trader.
It's just not worth the risk for me to get a tax hit. That's why I bought the senior notes
Look at the tax hit unit holders could get.
This is not a stock Tex it is a partnership unit.
this is for LINE but it has the same structure as BBEP.
http://files.shareholder.com/downloads/LINE/1771127700x0x889270/3AA043BC-7A18-4637-9F10-BF623829631B/S-4_FINAL_Slides_04_26_16_v3.pdf
"– If future restructuring of LINE indebtedness results in $1 billion, $3 billion or $5 billion of CODI,
then $2.83, $8.50 and $14.17, respectively, of CODI will be allocated to each outstanding LINE
unit"
for all I know there could be residual value in the units after BK. That would be great for me since the bonds I bought will be worth about 10X the current price.
gold futures confluence of support @ $1245.
Fibonacci 23.6 % retrace and trend-line support.
Redemption, retraction, cancellation, repurchase...that is not a sale in the public or private market...it's corporate housekeeping.
CEO Clarke spends CN$ 36,000 to buy 80k shares.
https://www.canadianinsider.com/company?menu_tickersearch=baa
Don't dare buy a share of this tex.
at least not anymore than a day trade.
It's poison.
CODI... Cancellation of debt income... = death of your account.
I have 600k of face value in the senior unsecured notes betting that they will be converted to common equity.
I know this situation quite well and sold all my common a month ago at 0.50
The common is partnership units...not stock. Read all the commentary about CODI on the seeking alpha board if you are considering the common.
If you hold commons while the debt is wiped out in BK you will be footed with a tax bill that could wipe you out...and you will have to file for BK.
If you want to speculate on this name buy the senior notes 2020 and 2022.
Note that they are highly illiquid.
I don't have the historical data. Just a vague recollection that 007 stated that he saw a trade at 60/100 in a post a few months ago.
These bonds are highly illiquid...I often see bond spreads of ten of more percent in far more liquid indentures.
The characteristics of the the bond are important also. Is it a secured bond or an unsecured bond. Could the bond be subordinated by a subsequent issue or is it firmly at the top of the capital structure?
I'm going to look further into the bonds. Have not called my broker about it yet.
Yeah, that's likely the latest trade price. Would make some sense given the increase in gold price.
Moïse Katumbi
Katumbi's career began in the fishing industry when he was 13.[8] He sold salted and fresh fish to the state-owned mining company Gécamines.[4][17]
In 1987, he created the holding company Etablissement Katumbi to aggregate all of his business activities including mining, transportation, and food processing.[4]
Katumbi founded MCK (Mining Company Katanga) in 1997, which specialized in mining and logistics and subcontracted for mining companies in the region, including Gécamines.[3][4][15] By 2015, the company had grown to 1900 employees and was a leading mining company in the country.[3] French company Necotrans bought MCK in November 2015 for an undisclosed amount.[3]
Around 2000, during the Second Congo War, Katumbi moved to Zambia, where he had business ties in transportation. He returned to the DRC in 2003 by invitation from President Kabila, who urged Katumbi to help fix the mining industry in Katanga.
thanks. I seriously doubt that there is a current quote. but there may be historical data.
It's complicated for sure. Kinshasa is far from operations, IAG had a coup in one of the countries they operated in and everything continued normally.
I think 007 said he saw a trade for 60/100 a month or so back.
I think it trades very thin. Might be hard to get a current quote but might be able to see historical data. I'm going to look into it with Vanguard.
BAA BONDS ??
Do you have any data on where BAA bonds have traded vs. par recently.
I've given that a lot of thought for about two years now.
His main opposition mentioned in that article is a mining executive and business man.
Additionally, although impoverished everything in the DRC operates on a small scale capitalistic structure. It has too...there are no social services. So as long as there is not total chaos we should be OK.
The people have seen devastation and hell on earth in the past and I'd guess that they don't want to go back to it.
No one was killed at the demonstration. It was about as hectic as a trump rally.
https://en.wikipedia.org/wiki/Mo%C3%AFse_Katumbi
17.5 that is the restricted cash.
25 Million total cash assets.
INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS lists restricted Cash as 17.5 Million,
so it is 7.529 in unrestricted cash. and 7.23 in bullion at market.
There are two bond payments left 8.75M & 8.75M = 17.5 restricted.
25 Million total cash assets.
I'm in for the long term
435k shares at a cost avg of 0.16
not buying any more and not selling unless I see a bk announcement...and I've heard that they have a very firm handle on the 2017 debt.
25 mil in cash and 7 mil in bullion end of quarter.
Other than that it is still the waiting game that we've been experiencing.
This will be the first earnings in quite some time without an impairment.
What has it been two or three quarters with impalements.
Hopefully their will only be additions to book value from here on out.
The recently updated reserves from April 19th PR are a good indicator.