Linda is biotch...! LOLz JayKay
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TPS = Cayman, REITs, etc. (Not HUQ)
They hold a portion of P/K securities and are a party.
imo
LOL, eom
Just to add: The P's traded at a peak of approx. $1,200 (from my memory) per share, even though the face value was $1,000, because of the divy of 7.75%, paid quarterly.
A 7.75% divy in today's market would most likely have a similar security trade over face assuming the issuing company is stable of course.
So, the value of the Preferreds would almost instantly be near, at face, or even over face value.
Imo of course...
Just to clarify, what happens to TPS, other preferrds to receive the same treatment under that scenario.
As for the SHN wanting prefferds in the New Co, it is my opinion that it was for settlement purposes, however, they put a clause in there that was "participating preferreds" which to me equates to P's convertibility in the event the New Co shares appreciate substantially, they will be able to convert and repeat the rewards.
That is why in real Big Board Companies, you want a P type security if you are going to buy a preffered type security. You get the best of both worlds: 15% taxed divy, higher priority, convertibility, higher rank, etc.
imo
This is a possible reason, MW trying to value WMI2 TOO HIGH. It all boils down to what WMI2 is being valued at. If reasonable, then preferreds have the majority share, if MW is trying to value WMI2 TOO HIGH, prefferds get diluted and majority of shares goes to common:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=64076254
It is either TPS is too greedy (other than absolutly, totally adhere to absolute priority) and won't take a reasonable haircut or Willingham is biased in favor of commons at the expense of prefferds.
It could also be Willigham could be going for more concessions from other settling parties.
imo
Hard to say, too many variables. IMO, we will get something because we, as preferreds are in the middle. If POR v 6.x, we (TPS/P/k) either get the entire WMI2, share with H, etc. This is based on what SG can prove during the confirmation/valuation hearings.
POR v7, we are guaranteed in the money, however, we did not know the ratio of the conversion.
So, either way, we preferreds will get something.
Commons are a different story. IMO, they will either:
1. best case scenario, get a tiny portion of WMI providing SG can get FJR, NOLs, disallownace, prefferds with a haircut, etc.
2. Warrants
3. Wiped out. My money is on commons being wiped out based on POR v 6.x. Commons be $7.5 billion plus H deficit is too far out of the money.
The only other thing about depos going forward, it might be the "nudge" needed to finish POR v7 and have one of the parties give in, etc.
Sorry, cannot give any better answer. All we can do is speculate since none of us are privy to negotiations.
So answer your question: I dont know, but for common is almost a death sentence. BTW, you can thanks to posters who said not to vote on POR v 6.x.
imo do not trade on my opinions.
I think we are class 20. Someone correct if I am wrong. eom
In the last court hearing the TPS said they were not involved in the settlement talks. They were left out. Why do you think all of the sudden they are in and able to effect settlement talks?
Yes, it means, SG should be able to direct the waterfall to us preferreds.
Remember, headgies are up against possible:
1. FJR
2. disallowance of creditors claims
3. PJS numbers
4. NOLs
5. carry forwards
6. etc.
Anyone of these can put prefferds in the money which would force a cram down on creditors.
From the article:
WaMu and a committee of shareholders tried to give both common and preferred shareholders a stake in the reinsurance company. They were opposed by a group of preferred holders, who were concerned about anything being given to holders of the common stock, the person said.
“The equity committee and the debtors were trying to provide for a distribution to both,” the person said. “The debtor was hard set on giving something to the commons.” http://www.bloomberg.com/news/2011-06-15/washington-mutual-reorganization-accord-with-shareholders-said-to-collapse.html
So now POR 6 goes through confirmation, and we get 0 - 1% unless by some miracle another deal goes through or the POR is not approved.
I am saying we live in the United States. There is no such thing as justice as we common joes want. Everything "possible" will be swept under the rug.
You have to understand that LEH was also concentrated in real property which was inflated in the US. Never again will be see real property recovery to those lofty prices. Engaged in REpo XX account practices.
The the wrong doers will just settle and get a slap on the wrist.
That is the American way. We all know it.
Just like Wamu... Do I think they deserve recovery, yes, especially pre-seziure holders, but reality... we can only ride coattails...and that is exactly what you and me are doing...
We all must face reality... and be realistic.
imo
Nay sayers on a Wamu Board talking about LEH or nay sayers on a LEH board talking about LEH? I have no interest in LEH. It is just waaayyyy toooo much out of the money for even junior creditors.
Pumpers on a WAMU board talking about LEH?
Hmmm?
Wamu was about $400 Million from EQUITY being in the money which was possible to obtain recovery.
LEH is tens of BILLIONs away from JUNIOR DEBT (above equity) from being in the money, NOT equity being in the money. Big difference.
Not only is LEH is waaayyy out of the money for junior debt, junior debt has a subordination clause that will be enforced. Huge obstacle.
LEH guaranteed too many subsidiary debts. Huge obstacle.
Disclosure: I own LEH senior sub debt. I wrote that off a long time ago. I also have been in Lehman since day one of BK trading it.
Just remember, the loudest poster pumpping on an illiquid stock is the usually the one selling to you.
imo
WMI2 is set to be a reinsurance company. In order to utilize NOLs, WMI2 can do so with another reinsurance company similar in size and business.
WMI2 and ExxonMobile = No go.
WMI2 and Kraft = No Go.
WMI2 and Sears = No go.
WMI2 and reinsurance = YES.
This is as it stands now.
Here is the article:
Reinsurance Sector Set for Mergers
ByShanthi Bharatwaj, , On Monday June 13, 2011, 1:21 pm EDT
Article updated with further commentary from AM Best.
NEW YORK (TheStreet) -- The $3.2 billion merger of Transatlantic Holdings and Allied World Assurance might reignite deals in the reinsurance sector as companies seek to enhance balance sheets and diversify the earnings base, according to industry analysts.
On Sunday Transatlantic Holdings, a specialty reinsurer once majority owned by AIG, announced its merger with Swiss-based Allied World Assurance in an all-stock deal. The merger would create an entity that will have total assets of $21 billion and a total capital of $8.5 billion.
The combination could leave reinsurers with a smaller capital base -- $3 billion or less -- hungry for scale, some analysts say.
"The reinsurance business has become more differentiated on size because of this most recent deal," said Kevin Lee, analyst at Moody's, commenting on the Transatlantic deal. "On one hand, you have a group of companies with more than $5 billion in capital, some others with $2.5 billion to $5 billion in capital and then you have a group of companies below $2.5 billion. For companies in the lower end of the range, and given the extent of losses from first quarter, there is possibly more interest in M&A."
Companies with a total capital of less than $3 billion include Endurance Specialty , Enstar group, Platinum Underwriters and Montpelier, according to data available on Bloomberg.
"Over the past decade, there has been a drive for size," says Laline Carvalho, director and reinsurance analyst at Standard and Poor's. "There have been a lot of management teams that have pushed to become bigger."
Tracy Dolin, also an analyst at S&P points out that size might be more relevant for property catastrophe reinsurers where they can get better pricing terms for their size.
But other factors besides size also may drive more consolidation. According to Carvalho, reinsurers are also looking to diversify their earnings stream. "It has been a significant year of catastrophes for reinsurance companies," she says, noting the disasters in New Zealand, Australia and the U.S. "There is a desire for some management teams to become more relevant to their brokers, reduce exposure to catastrophic events and if they are more diversified they can choose to play those opportunities where they see the best returns for their capital."
Stocks of reinsurers such as Endurance Specialty, Platinum Underwriters and Montpelier trade at a price-to-book of less than 1. Such valuations are attractive to buyers but could result in lengthy battles over pricing of the deal as sellers will be reluctant if the offer price is too low.
Another challenge, according to Carvalho, is that businesses need to find a good match. Transatlantic and Allied were complementary businesses, with the former dealing chiefly in reinsurance and the latter in insurance. But other global reinsurers are more diversified and involved in all types of businesses, which could pose integration risks.
And while smaller companies might be inclined to consider mergers to grow bigger, size is not always an advantage, Carvalho adds. Smaller reinsurers can be more nimble and insurance companies continue to do business with smaller reinsurers because they wish to avoid counter-party concentration risk that could arise in working with only one or two big players.
Management's outlook for the market could also be a driver for deals, according to Moody' Lee. "In the past, deals have been more "soft market" transactions where the acquiring company has simply returned excess capital to shareholders.The Allied-Transatlantic deal is more of a "hard-market" transaction, where they are building a balance sheet to capture benefits of a potential hardening of prices in the reinsurance market," said Lee.
Analysts at A.M. Best said that while a soft pricing market tends to stimulate merger activity, deals with somewhat ideal conditions like the Transatlantic-Allied merger are hard to come by. "You have to find organizations that have complementary businesses, no overlap, clean succession plan in terms of senior management and similar cultures. Both these companies were born out of AIG and their cultures are similar. The managements have a long-standing relationship. Senior managements have to come together."
Shares of Transatlantic were climbing 10% to $48.50 Monday . Shares of Allied World were slipping 4% at $55.74.
--Written by Shanthi Bharatwaj in New York
>To contact the writer of this article, click here: Shanthi Bharatwaj.
FYI: LEH Cap Trusts are waaaayyyyy out of the money. All the POR over there have senior debt have very little recovery. Last i checked, they were approx. below 19% recovery AT THE SENIOR LEVEL.
Keep in mind, there were players (creditors) that had behind the scenes conferences regarding LEH and A&M and the potential recovery of LEH. These same creditors come out with their own competing POR and guess what? All the competing PORs show CTs/junior debt waaayyy out of the money. All this, to me is considered inside information, but A&M (?) stated that everyone can talk to them regarging LEH.
If you think about it, if a creditor was about to inquire about LEH behind close doors and they come out with their own POR, you know they would buy what will have recovery, i.e., none of the POR shows recovery for CT/junior debt.
What does that tell me? Creditors did not buy any CTs.
Anyhow, you cannot merge LEH with WAMU because as it stands now, LEH = bank holding or was it investment something while WMI will be reinsurance. This alone will not let the two (2) merge. IRS code sections states that they must be substantially the same business and size, etc.
All in my opinion of course.
Found this posted Y board. Interesting... Credit to electrofriend
Reinsurance Sector Set for Mergers
ByShanthi Bharatwaj, , On Monday June 13, 2011, 1:21 pm EDT
Article updated with further commentary from AM Best.
NEW YORK (TheStreet) -- The $3.2 billion merger of Transatlantic Holdings and Allied World Assurance might reignite deals in the reinsurance sector as companies seek to enhance balance sheets and diversify the earnings base, according to industry analysts.
On Sunday Transatlantic Holdings, a specialty reinsurer once majority owned by AIG, announced its merger with Swiss-based Allied World Assurance in an all-stock deal. The merger would create an entity that will have total assets of $21 billion and a total capital of $8.5 billion.
The combination could leave reinsurers with a smaller capital base -- $3 billion or less -- hungry for scale, some analysts say.
"The reinsurance business has become more differentiated on size because of this most recent deal," said Kevin Lee, analyst at Moody's, commenting on the Transatlantic deal. "On one hand, you have a group of companies with more than $5 billion in capital, some others with $2.5 billion to $5 billion in capital and then you have a group of companies below $2.5 billion. For companies in the lower end of the range, and given the extent of losses from first quarter, there is possibly more interest in M&A."
Companies with a total capital of less than $3 billion include Endurance Specialty , Enstar group, Platinum Underwriters and Montpelier, according to data available on Bloomberg.
"Over the past decade, there has been a drive for size," says Laline Carvalho, director and reinsurance analyst at Standard and Poor's. "There have been a lot of management teams that have pushed to become bigger."
Tracy Dolin, also an analyst at S&P points out that size might be more relevant for property catastrophe reinsurers where they can get better pricing terms for their size.
But other factors besides size also may drive more consolidation. According to Carvalho, reinsurers are also looking to diversify their earnings stream. "It has been a significant year of catastrophes for reinsurance companies," she says, noting the disasters in New Zealand, Australia and the U.S. "There is a desire for some management teams to become more relevant to their brokers, reduce exposure to catastrophic events and if they are more diversified they can choose to play those opportunities where they see the best returns for their capital."
Stocks of reinsurers such as Endurance Specialty, Platinum Underwriters and Montpelier trade at a price-to-book of less than 1. Such valuations are attractive to buyers but could result in lengthy battles over pricing of the deal as sellers will be reluctant if the offer price is too low.
Another challenge, according to Carvalho, is that businesses need to find a good match. Transatlantic and Allied were complementary businesses, with the former dealing chiefly in reinsurance and the latter in insurance. But other global reinsurers are more diversified and involved in all types of businesses, which could pose integration risks.
And while smaller companies might be inclined to consider mergers to grow bigger, size is not always an advantage, Carvalho adds. Smaller reinsurers can be more nimble and insurance companies continue to do business with smaller reinsurers because they wish to avoid counter-party concentration risk that could arise in working with only one or two big players.
Management's outlook for the market could also be a driver for deals, according to Moody' Lee. "In the past, deals have been more "soft market" transactions where the acquiring company has simply returned excess capital to shareholders.The Allied-Transatlantic deal is more of a "hard-market" transaction, where they are building a balance sheet to capture benefits of a potential hardening of prices in the reinsurance market," said Lee.
Analysts at A.M. Best said that while a soft pricing market tends to stimulate merger activity, deals with somewhat ideal conditions like the Transatlantic-Allied merger are hard to come by. "You have to find organizations that have complementary businesses, no overlap, clean succession plan in terms of senior management and similar cultures. Both these companies were born out of AIG and their cultures are similar. The managements have a long-standing relationship. Senior managements have to come together."
Shares of Transatlantic were climbing 10% to $48.50 Monday . Shares of Allied World were slipping 4% at $55.74.
--Written by Shanthi Bharatwaj in New York
>To contact the writer of this article, click here: Shanthi Bharatwaj.
http://finance.yahoo.com/news/Reinsurance-Sector-Set-for-tsmf-2253811151.html?x=0&sec=topStories&pos=8&asset=&ccode=
One of Ilene's tweets (saw someone repost the quote):
DelShareholder Ilene Slatko
Out in the hall, Chas Smith, BR and Pref trust atty in conference
8 Jun
Interesting volume spike in commons and at the same time, accum, money flow and volume spike in the P's. K's, not worth mentioning. Would have been more interesting if ALL classes had the spike at the same time.
Could mean someone knows something OR a trader group bought in.
imo
Excellent! Very few understand. eom
That is why preferreds are considered sophisticated investors. imo eom
IMO, the way MW can screw us is if he values WMI2 TOO HIGH. That in turn gives us preferreds a lower conversion rate.
If I remember correctly, from the hearing of May 24, 2011, Rosen used the figure of $160 for WMI2 which would be comprised on run off debt and participating preferreds. The balance will be conversion of x class to y class and preffereds and commons will be the NEW common. Rosen also mentioned that they could not agree on the value of WMI2, hence my comment of valuing WMI2 TOO HIGH by Willingham. Again, this is based on my memory.
Best analogy I can come up with off the top of my head:
We can be big fish in a pond, or be small fish in an ocean.
big/small fish represents conversion.
pond/ocean represents the value of WMI2.
Best case for prefferreds (assuming no concessions from JPM/FDIC), I would rather refloat the preferreds at full FV and let the commons take WMI2.
WHY? We as preffereds, do not have to wait for full value when converted to NEW commons. (Based on if we refloat)
We as preffereds can continue to earn divies taxed at 15% while NEW commons try to do their mergeres to increase their value. (Based on if we refloat)
We as preffereds, specifically P (NOT K), have a conversion feature in the prospectus. If the NEW commons ever appreciate significantly, we can convert to NEW commons if it benefits us. We would also be known a participating preferreds. (Based on if we refloat)
BTW: There are still numb nuts who still think K can only get cash. Same class = same disposition! ROLMAO!
There is more, but I am working.
imo of course.
Trialblazin: Thanks for the kind words. The thing is, it is very hard to speculate since there are many parties involved.
All I can say is: I can only hope that absolute priority is adhered to.
Sorry, I don't really a better response.
The details are just too tight lipped and there really is no leaks, plus I was unable to listen to the hearing today, so I am clueless in that regard.
I am still pro-preferreds, regardless and will be grateful to be in the money and bring this thing to a close.
Good luck to all.
imo
someone posted yesterday about tps being involved with the hedgies..it's obvious now they are ...and look at the comment bout this new plan being significantly different than the previous one
Several weeks ago, someone posted that SG would ultimately have to "back-stab" TPS. I thought that strange, as I considered TPS to be an ally of equity. But now I don't; and I'm beginning to understand why SG doesn't as well.
marayatano Member Profile marayatano Share Saturday, May 14, 2011 2:34:41 PM
Re: william48 post# 289709 Post # of 305287
Here is one scenario why no one filed an objection other than TPS:
Commons have a $7.5 billion (plus deficit in the HUQ) hurtle be be .01 in the money.
There could be a revised GSA w/ a revision to the POR (the NEW settlement talks behind the scenes), in that TPS (hence their objection only being filed) was cut out of recovery except for the 50 million distribution to them as consideration for releases. It is a forced release in the POR.
You essentially lop off $4 billion going to TPS and redirect the waterfall to commons. Therefore, commons only face a $3.5 billion hurtle (plus HUQ deficit). This achieves releases from all parties, preferreds, commons and TPS by way of force, ie, $50 million distribution.
TPS is essentially going to be back stabbed by EC. TPS filing objection is a CYA filing.
HF have no choice but to agree and start to accumulate non-restricted ownership securities to make the best of obtaining shares of the reorganized WMI2.
Strictly my speculation.
Means you caught something and need to see a doctor for.treatment. eom
Right means $$ coming... left means $$ going... eom
My right palm itches. hint hint eom
Aren't you the Bankruptcy consultant who recommended buying Washington Mutual BANK Bonds ???
May be you should buy some WMI securities and you can join us...
LOL
imo
Not sure where you got that "opinion" from, but just so you know, WMI preferreds pay divies, not interest, and they are perpetual, and do not not expire. So the 3 years stuff and back interest does not make sense, because as stated above, WMI preferreds pay divies and are perpetual. Under BK, divies are not declared nor do they accumulate like debentures.
... and for the "numb nuts" who keep on saying K's have to be paid cash while P's can only get converted, are uniformed. Members of the same class will have the same disposition, regardless of what the prospectus states. While in BK, the prospectus is merely a guideline that does not have to be adhered to. The the PORs and press release recently issued by WMI is enough evidence to support what I have been saying all along, but people can't see it.
I would take the information from the common board with a gain of salt, however, there are only a hand full that understand what is going on other there.
Another thing I have noticed, I see some people think that K's will get 50% distribution and P's will get 50% distribution. I guess they don't understand that K's have a 500 Million value and P's have a 3 billion value and will receive a pro rated share, not 50% - 50% distribution.
BTW, this post is not directed at you.
imo
Sorry, I wasn't paying attention. eom
It was today, however, I am unsure of the time. eom
Notice of Cancellation of Deposition of Owl Creek Asset Management, L.P.
http://www.kccllc.net/documents/0812229/0812229110525000000000013.pdf
Notice of Cancellation of Deposition of Centerbridge Partners, L.P.
http://www.kccllc.net/documents/0812229/0812229110525000000000012.pdf
Rosen is an attorney from a well respected law firm. I don't he would do such as thing, however, other parties can scratch each others back.
It is done all the time, even at my work, as I have witnessed it several times. It does not have to be necessarily a bribe, buy someone's integrity, etc. Just a "mutual understanding..."
Anyhow, I will give him the benefit of the doubt and wait to see the details.
IMO
The conversion ratio of Ps to commons is 1:117 (or something like that). Is there any chance that they can go with this conversion?
Since the company is reorganizing now and it is not going anything near to Chp 7, can we say that the preferreds will definitely get a reduction on their recovery?