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behave? i'll try but i can't make any guarantees lol
yep, i see the commons getting at least $2 in the end of a chap 7. the stock price will most likely hover or pop up and down. some companies have been using chap 11 like chap 7. they just use the same filing, don't convert it, and basically just keep selling off assets until there is nothing left to sell.
just because we are sitting in chap 11 doesn't mean they can't sell everything they got just like it is, hence the stock price....
JMO of course, but that's my swag.
phran, remember this, the bondholders aren't entitled to any more than face + accrued interest, that's it. while i'm sure they have cross default provisions, and payable on demand and such, if chemtura presents a plan to the court where they elect to pay off the 2009 in full, pay the interest on the others, and pay off the creditors, then i don't think the judge would object to that and will most likely tell the bondholders for 2016,2026 that 'that's the way it is, be happy with it'.
i still expect a couple of asset sales to cover the 2009 and a POR that basically says the scenario above.
i wouldn't be alarmed if the POR is extended again, as i expect completed sales before the POR is filed.
you're confusing a creditor with a bondholder. if 51% or more NEW stock is issued, to anybody, the nol's are toast for the most part. even if it is less than 50%, i think there is some kind of pro-rata deal. it can get complicated for sure.
accounts payable and loans are two different things.
phran,
depends.
scenario 1, chemtura finds a financier to pay off all the bonds and roll over the debt. result = commons intact and rebound to $4 short term
scenario 2, chemtura sells off enough assets to cover the 2009 bonds, keep a little $ in the bank, and then has a better chance of refinancing the remainder of the bonds to rollover. result = commons intact and rebound to $4-6 short term
scenario 3, chemtura sells pvc and crop division, covers all debt except unsecured, keeps cash on hand, re-fies the unsecured with a secured note. result = commons intact and rebound to $6-8 short term
scenario 4, 1 for 2 reverse split, reducing outstanding commons to 120ish million, issue 120ish million shares to cover ALL the bonds (no preferential treatment BK law), still have a few unissued shares on the books, essentially giving the debt holders 47-48% of company. commons loose half, but $ correction is 2x because of zero debt. result = commons half amount, but rebound to $6-8 short term
scenario 5, something stupid because of an obama speech about another depression or crisis, which freezes lending again.
scenario 6, chapter 7 liquidation. commons receive $2-5 depending on lending, regulators, and general overall world economy.
I'm leaning towards scenario 2. I don't think scenario 4 would fly because you would have to get the vast majority of the bondholders to agree to that deal (don't know exactly what %, maybe around 80).
Anything (including chapter 7) is fine with me, just as long as it's not scenario 5.
stoman,
read the law, beginning @ "(g)"
http://www.law.cornell.edu/uscode/html/uscode26/usc_sec_26_00000382----000-.html
phran,
expletives? you mean adjectives! He is what he is and he hides it in plain sight. People don't believe it because they think it is unbelieveable. I think it was 4 or 5 days before the election he said he would 'fundamentally change this country'. This country's fundamentals are founded by the constitution. If you want to 'fundamentally change it', then what do you have to do to the constitution?
It's rather simple.
Do you honestly think he sat in Rev. Wright's church for 20 years and didn't hear a thing?
He's a Farrakhan knock-off, plain and simple,,,with a few of his own personal twists when it comes to how he will 'snooker' the white folks into blind reparations.
Reparation example #1 for tonight: government health care. This debate is not about choice, what people overlook is that IT IS MANDATORY and if you don't buy it, the IRS will fine you or put a lien on your home or take it or freeze your accounts.
What does it have to do with reparations you ask? The lower income folks will receive subsidies and the illegals will still walk in for free.
It wont do a damn thing to lower costs, the only thing it does is make more white folks pay.
cmm,
nah man, can't look because i'm a cheap bastard. Jrd just sprung me from solitary confinement. The day i got out the board went down the drain(must be my fault). Maybe this gary fella is an arnold plant? Don't you guys go and run him off just yet, i have fun pickin on these so-called 'elites'.
mad,
You're exactly right. It was a pre-arranged shafting. My only concern is that Judge Gerber didn't get all the filth wiped off before he got back to our deal. So far, he looks fair. In that GM massacre, well our friendly well-spoken communist radical president was pullin some major strings. Union back door smokey room deal all the way.
gary,
hayz? what does that have to do with the price of tea in china?
comparing chemtura to hayz?
well, let me ask you this, would you compare hayz to alcoa?
alcoa makes aluminum, hayz makes aluminum wheels, same thing right?
the problem with hayz is that they re-tool and re-market every year.
chemtura keeps churning out the same thing, year after year.
now if hayz could sell a part that they didn't have to re-design every year, they may make some money (and let's not forget they are depending on union labor not to break them)
just think if alcoa had to make a new flavor of aluminum year in and year out.
it's a good thing that chemicals don't need to react to consumers. they general are only a part of the equation. let the retail manufacturers handle all that.
next please
gary,
just because you have a "..... laude", really don't mean a whole lot. i've got one too. whoop te do.
i'll give you the benefit of the doubt:
so therefore, you can explain to me and others what the salvage value of a refinery is that has depreciated out, based on initial cost to build, at current market conditions, adjusted for the appreciation of the 'time value' of the dollar? according to the books, it's not worth much. then, could you help me out on recapturing depreciation with regards to sales over and above the depreciated salvage value?
using your ideology, a 30 year old refinery (as most are in this country) would only be worth what it would bring at the scales of a scrap yard.
i'll give an example: say you bought a car 30 years ago for $3000. you keep it and now it's a classic in good shape. what's it worth? 100 bucks? that's what it would bring at the scrap yard. or is it worth $25,000?
same theory applies here. book depreciates, but inflation appreciates true market value. (hence time value of money)
what you fail to understand is that valuation for 'tax purposes' is NOT the same as valuation for 'current market sales'
you've always got some folks that think they are smarter than everybody else. they are mostly doctors, lawyers, and some mba,phd types. fact is that they are the ones that call plumbers to fix the toilet, electricians to reset breakers, and mechanics to tell them their car wont start because it's out of gas.
get over it
JD,
let's not forget we have the same judge that screwed the bondholders in General Motors and put the union's interest ahead of them.
Like i said, it's best to take it out of the judge's hands if at all possible.
jrd,
i don't even want to know what kind of promises you made or strings you pulled, but nonetheless i guess i'm off the "indefinite ban" (that's what message i get when i make one post per day).
it probably wont last though. lol.
You tell me which 30 companies formed an EC, and I'll tell you which 30 companies had a positive book value.
When you get right down to it, my advice is to never trust a bunch of lawyers,,,and keep in mind the judge is a lawyer.
The one thing we've got going for us is that the NOL's have mucho value over the long term.
In the short term, the thing we have going against us is the banking system's current stingy lending.
For the reasons above, i think it is imperative that the company sell 'substantial' assets, as it will reveal a residual book value much higher than what is now reflected on the current books.
Then it will be a much harder task for the lenders to 'steal' more than their rightful share of the company AND/OR it will make for a much easier re-financing of the debt.
okay chart guys, today is your chance to shine. you fellas ought to know where the close will be today. i'll guess 78-80, based purely on the magic 8 ball, and maybe the fact that the recent court filing now establishes 2 law firms authorized to handle sale documents and implementation,,which is in addition to the 2 tax/accounting firms that are advising on the number crunching with/without sales, and don't forget the 3 firms hired to peddle certain parts of the company. (that's alot of money thrown away if they aren't interested in selling something)
let's hear it, where will the close be?
EDIT: and specify chart or swag
well i'll say this: i post one lousy post a day on here, max, because someone let ol arnold leave his drivel up here, and i post one time tuesday about capital gains, and how some folks best not have their head in the sand when the long term rate goes from 15 to 30+ on Jan. 1, 2011, and my post disappears in less than 5 minutes.
if either of you moderators did it, you fellas can just send me a nice little pm or post it up that you don't want my posts, and i'll gladly take it somewhere else.
we can't clarify cap gains, but we can post cabo, scotch, ac/dc, houses, cars, and other bs 10xxxxx times?
i'm raising the official bs flag
i don't mind the off topic posts, i.e. cabo, scotch, cars, etc. but you damn well ought to throw in some good lookin naked women !!
like i said, just speak up
xenn,
now don't you start any rumors about me and sklauble. sshhhhhh.
i'm not a marine life expert, so how was i suppose to know the difference of the fins between a shark and a dolphin? ol arnold wanted to swim with the dolphins so who was i to disagree with his worldly knowledge? (shrug)
mega you're a little late to the game. im sure there have been alot of people that have flipped or may be gone, but there is a core of holders here,,,which by in large hold very significant positions,, that see this company for what it is,,,which is hopefully the opportunity of a lifetime. the ROI of chemtura has even surpassed the infamous pilgrim's pride. im here to the end. if i lose it all, then i will have lost more than most folks ever have. it's do or die. by next april, either i'll be yuckin it up with cmm, or i'll be looking for another opportunity. but one things for sure, when next april comes, i wont be wondering what might have been if i had the nuts to put it on the line. no risk = no reward
he's gonna say Arnold stepped in and hit the ASK after waiting for 12 cents for the past few months...........lol
you can't chart this stock. you only know where it's been and where it's going.........
it has been nice around here without that windbag.
the bonds were rated as junk before they filed BK. although they are presumably still junk, the 2016 is trading at 88% of face value. that's nuts. the maximum potential upside is 20% return at that price. you can rest assured that whoever is buying those bonds know the 'end game' and they aren't buying for peanuts to get 20%, they are expecting 20% on high million dollar investments.
if this isn't insider trading, then i don't know what tha hell is! red flag alert people, news obviously coming.....
20% jeez....we could see that by the end of the week after some of the billings and news sinks in.....only 60 cents...
If there is one reason for Rogerson to get his butt in gear, here's the link. Having debt is not the place to be right now. Downsizing is better than nothing at all. Rogerson, as a ceo, has a thousand times more experience in corporate management than our fearless leader of the pack. I dont worry about chemtura and Rogerson. I worry about this clown.
http://www.reuters.com/article/newsOne/idUSTRE57K4XE20090821
This bond action is unreal. I was looking at Ford's bonds yesterday,,,,,as in like Ford Motor Company, the car folks, and their bonds FCZ, FCJ (par $25) are trading at 73.5% of face value and the dividend yield is 10.3%. Now were talking Ford, and everybody knows who ford is, and they aren't in BK, and our little ol chemical q BK company is spanking that arse with the bond prices. Since Chemtura's bonds are trading at 80%, 85%, and around 60% respectively, i dare say something is up. Although i think there is an absolutely almost zero chance that a buyout of the entire company will happen, if those 2026 bonds get up in the 80%+ range............you best look out......(and i hate those rumors, fyi)..
Overdue bonds in a BK company trading higher than Ford's........that's an eye opener.
....until the next 24 hours......
Food for thought:
Known facts,
1. an army of attorneys are working for chemtura worldwide
2. the company has returned to profitabilty, even in this economy.
3. an asset sale is looking likely again with the addition of the plastic additives division being put up for sale.
4. the crop division is for sale.
5. the petroleum additives division is for sale.
Given this and the fact that Rogerson was quoting saying that the crop division was worth $700 million + and the petroleum additives division was worth at least $500-600 million,,,,think of it like this.....
If the plastics division sells for $400 + , then there is virtually no way in hell management could cancel the existing shares. They would have already shown their hand. Rogerson acknowledged the value of the divisions put up for sale prior to the BK filing. The debt holders are entitled only to repayment of their face value plus interest.
If the crop and petroleum division sales could cover all debt, then the plastic additives division is worth as much as the total book value of the company. What the heck is left? Chopped liver? Well, just 5 other divisions of the company. 5 divisions of a global company ought to be worth something. How in the hell would management get it past the u.s. trustee, the judge, and an equity committee that those 5 divisions are worthless? Aint gonna happen. No way in hell. Shares look more surviveable the more assets they sell.
Book value @ $1.30 something is a joke. It's a mirage created by depreciation with no consideration for the 'time value' of money and inflation. The true value of the company, even in a chapter 7 liquidation is a conservative 3x-4x times current book value.
For you naysayers, put that in your pipe and smoke it.
At present, there are 3 businesses up for sale.
All three are having or had their books looked over.
1. Plastic Additives shopped by Lazard (as found in the billings and the newly released article,,also given away as pointed out week and a half ago by the retention of the French firm)
2. Petroleum Additives shopped by Citibank
3. Crop Protection shopped by Merrill Lynch
It's important to note that you will find little to no billings related to #2 and #3 because they were pre BK agreements that based compensation for shopping the businesses upon a successful sale. No sale = no billings, unlike Lazard. Strictly incentive and % based, much like any real estate transaction.
No billings have been filed by the Australian firm, which would be telling, as they may have been required to do some title work for the crop protection unit.
Of the small army of law firms retained, special attention is being paid to NOL's, NOL's as relating to subsidiary overseas, NUBIG'S, NUBIL'S, tax basis's, valuations, effects relating to divestures, intellectual property, property title clarification as related to IP, etc.
This is NO WAY an indication that the company has given up on an asset sale, it's quite the contrary. All indictations still point to a very significant sale; little to no dilution therefore saving the commons, and saving the retirement plans of the employees.
Now KPMG also has expanded tax coverage. That's way to much emphasis put on taxes for a company that's not making much money. There's some serious sh!t about to go down. Just the shear amount of law firms retained shows that.
Most likely that is the ucc they are referring to. I'm more interested in "PUD" which i assume is "potential unit divesture". From the looks of Lazard's billings, I'd say that pvc additives are on the chopping block, but i don't know if they would call it a "unit". Maybe just certain sites. Then they also look to be doing alot of financial valuations, most likely for the 'abl' lending they may turn to for BK exit financing. They could be considering selling off the additives units, keeping the ag units, and using abl's for short term exit financing. (It would be cheaper paying higher interest rates than paying these law firms).
Or I could be talkin out my butt. When the australian law firm submits a billing, then it should be a little clearer.
And for those of you who don't understand GAAP, they made $10 million according to last month's MOR.
Until the next 24 hours............
Lazard is where you'll find the most references to an asset sale. Petroleum additives are what is mentioned. There wasn't any activity until June, and then apparently someone has been on it full time ever since. There are references to divesture plans, plan implementation timelines, stalking horse bidders, etc.
DeToilet Tax Consultants (what a ripoff, damn they are padding invoices) coins a new term for asset sales.......they call them 'reverse acquisitions'. There was some discussion about what kind of impact a sale would have in regards to tax purposes.
Then there was another company (forgot which one) that was doing title work in regards to patents and who they belonged to.
In summary, asset sales are still very much in play.
New court doc, asset sale mentioned. French law firm application for services.....among those listed in the docs:
"(d) advising the Debtors with respect to the implementation or impacts of
any asset dispositions relating to the non-debtor French subsidiaries; and"
They need to get these lawyers off their butts and quit fartin around......let's get the show on the road. I smell something.....it's green and full of germs, but it looks good in my hands....
? Plastic Additives ? is all they have in france? or is it just a distribution type of office, sales or whatever? Someone ought to run down the hard part, i did the easy part. And besides i'm only worthy of one sorry ass post per day,,,,,since i've got a hard head and stand on principle. Nobody's perfect lol.
if you happen to go by way of san francisco, could you do your country proud and kick ms pelosi in the nuts for us?
xenn,
i read your post and didn't know whether to say thanks or slap my momma. lol
yeah, where is your old buddy? do you think he skipped town rubbin his 2 nickels together after his 100% roi?
it's great to see him gone......i bet he forgot the stock symbol...maybe a supreme brain fart will jog his memory and we will once again be blessed with his infinite wisdom?
can you visualize a nerdy college kid sitting in his dorm room asking his roommate to pull his finger about right now?
(i must be coming down with something,,,,,i aint thinkin right)
now back to the real world, did anyone notice that company buying up prepetition claims of debt? just like the buyers of the bonds, these guys are buying claims anticipating getting paid in full. it's not a PR, but its still more positive news......
I don't understand why you fellas are all excited,,,,,heck, me and a few others have been sitting here since mid march wondering what's taking so long. I'm more surprised we haven't got to this level earlier, than it getting here. Looking at the filings, I see ANOTHER law firm hired for (?) services yet to be determined, but since they have offices in DC and China, I say hmmmmmm, good for me.
I say PR or a stalking horse agreement filed in court within 2 weeks.
Bad news would surprise me; good news......well chit what took so long....
said it a few weeks ago and i'll say it again, i think they are 'carving out' a segment of the company to sell. i would imagine that it's an IP nightmare to try to separate out 'what' goes with 'what' and 'if' it goes with a sale. just because they may sell the crop division doesn't necessarily mean they will give away any crop related patents with the sale. and with this carve out you would assume they would have to re-file or modify certain ownership aspects of any patents in question to assure the proper title of ownership of said aforementioned patents.
on an off topic note: if this post goes through, i assume that i have been released from the I-hub solitary confinement. (i dont think i learned my lesson though) probably wont last long... lol
EDIT : ooaps, i learned im to old to take any crap and yes this is my one post for the day.
phrantic,
what i think people are overlooking is that there are 2 bonus plans. one based on a successful emergence from BK and one based on earnings. i may be wrong and i'll have to re-check, but i don't think there was a distinction on earnings either in or out of BK. now that i think of it, they would have to be stock options/warrants etc. while IN BK,,,,because the trustee can't say diddley after cem exits BK. the incentive plans would have to be fullfilled with the current stock (same as what we got) to even exist.
while it may seem advantageous to exit BK promptly, and most likely is in most cases, that doesn't mean cem can't run along while still in BK and make plenty money triggering a bonus. take WR GRACE for example. they've been in BK for years making money, stock price acts like it's not in BK, etc., but remain there trying to settle some lawsuits......
and then let's not forget they even factored an asset sale provision in the incentive plan. well i think it's safe to say they aren't planning on exiting BK and THEN having an asset sale...
the incentive plan(s) are based on current shares/equity and that's what we've got. they aren't cancelling a damn thing. sometimes it just hits ya.........it's called common sense.
there should be some news on an equity committee unless they hurry up and sell something. it would make for a nice pop.
mad/local,
you 2 guys bring up a good point, but you are overlooking the obvious..
i was reading through the trustee's objection and this gets brought up about basically "how can you have an incentive with equity, when a POR hasn't been filed yet that will 'determine' (emphasis added) whether or not there will be equity"
this is when the light bulb should have went off. the trustee basically asks how you can award stock that you haven't determined will exist upon emergence from BK.
well the answer is,,,,they know FOR SURE that some or all of the current stockholder equity will be there. they make no distinction because there will not be any. (you got to have stock to be able to give it away)
for further arguments sake, IF the judge approves the incentive program and someone meets the criteria to be awarded stock, well there damn well better be some stock available or they have opened themselves up to another lawsuit for breach/fraud. In other words, they can't cancell all the shares and do an equity swap with the bondholders because the result would be no shares(equity) available for the incentive plan.
I wasn't surprised to see this objection and actually welcome it, as it sheds more light on what rogerson is thinking......but ain't telling.
g2, or whomever asked (i forgot), matt (admin) said i could get out of cemjq jail if i paid for a subscription. kinda sounded like a strong arm to me so i suppose i'll be limited to one post per day.
utah,
I am about 99% sure all the bonds have cross-default provisions in them, which basically means if you file for BK then ALL the bonds are immediately due.
While there are a few reasons why chemtura filed for BK, it is mainly because of one thing, and that was a cash pinch. This pinch was caused by:
1. our election process coupled with the banking crisis
2. credit agencies lowering the rating of chemtura because of the inability to repay the july bonds
3. and restrictions placed on the credit revolver because of the lowered credit rating.
It basically comes back to the loon we have in office and banks holding on tight to what money they have (for fear of being seized and controlled by the government).
Given that Rogerson 'could' have tried to negotiate with the july bond holders.....but did not.....tells me that he did and still believes in an asset sale. I think his 'plan' of reorganization will be the same plan he had before he filed. Pay off the july bond holders in full and then go back to the status quo before BK for the other bond holders, which the judge shouldn't have a problem with.
An asset sale would cure chemtura's credit rating, short term debt issues, and capitalization requirements of the credit revolvers instantly. Like flippin a light switch. Problem solved.
On the other hand, Rogerson maybe could work a deal with the july bond holders (a re-finance), but he would also have to get it approved by the other bond holders and the judge, while not showing a preferential treatment that is not allowed under BK law. This is certainly do-able, but more complicated and more drawn out.
Either way, I don't think a debt for equity swap will happen, which insures the common holders. I think it would have to involve all classes of the bond holders, not just the july bonds. Very complicated and the biggest pain in the ass for Rogerson.
Issue new shares to raise capital-----out of the question.
You've got to ask yourself,,,if you wanted to negotiate a deal with the bondholders, wouldn't you have already began negotiations?? Make no mistake, this would make the news.
I think that Rogerson is still set on a sale and he is close, or at least he thinks so. The billings that will be rolling into court should shed some light on this, but in my opinion, the activity on intellectual properties has to do with a carve out in the event of a sale.
If i were Rogerson i wouldn't consider a re-fi with the july bondholders,,,only if it were a last resort. Given the way our government is screwing up our economy, i wouldn't bet on a big time recovery that could pay off a 400 million debt in a couple of years. I just don't think it's possible.
Or i could be wrong. Your pick.
interesting to look at another part of the world where chemtura does business. you can look all over the site, but there isn't a mention of BK. they make far more chemicals for crops than i ever imagined. check it ---
http://www.chemtura.com.au/crop/
this business is for sale, any takers? lol
Enough with all the jibber jabber, has anyone noticed the hiring of the law firm in Singapore in the court docs?
http://www.amicalaw.com/
This may get interesting (or not), but at least these folks speak Chinese.
soap opera?
yet you make some allegations of mammoth proportions without any backup?
why don't you do us a favor and peck those keys on your little computer and enlighten us OR
stick a sock in it.
BTW, no one here has threatened you,,but if they do I'm sure you deserved it.
I don't make threats, i make promises. I promise you that i most likely have more shares than you, so ease up with the BS.
turbo,
you can look at it like this: If the shares are cancelled, the stockholders equity AND the companys stock that has not been issued is essentially worth nothing,,,i.e. there is no equity. Without equity, you can not have an incentive plan based on equity. Bluntly, chemtura can not implement this plan if they do some kind of debt/equity swap. Further, we already know that they can not do a debt/equity swap greater than 50%, or they loose mucho hundreds of millions in tax credits.
IF they thought a debt/equity dilution was in play, then they would have included it in the footnotes WITH THE 'WHAT IF' SCENARIO IF A BUSINESS SEGMENT DIVESTURE HAPPENS and it's relation in determining EBITDA as related to the encentive plans.
ALWAYS read the footnotes.
I hate to bring it up, but Bo Pilgrim gave Don Jackson an incentive deal of somewhere around 3 million shares of stock that are to be vested over time, just as they mention here. It's along the same lines as chemtura's, but there are still people asking if those shares to D. Jackson are 'post' BK shares or the same as everyone has now. From the looks of the share price, i think they are figuring it out.
I don't know about the bollies, but one thing is for sure...arnie will say 'to the moon' and 'low teens' this week.
Oh boy, i just can't wait.
Holders of 5% or more of Chemtura stock can not sell per court order to protect NOL's without court approval. If Barclays was a 5% holder after that order, then you will hear about it in the court filings because the lawyers will go after them. All sales without approval are null and void, as if they never happened. This could get interesting.