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ie.
Creditors bought Mt. Pass mineral rights from Molycorp.
Oaktree owns majority of Mt. Pass plant.
Molycorp neo will emerge from ch 11 consists of Oaktree (92.5%) and unsecured bond holders (7.5%).
If there is a buyout for the Mt. Pass only, I don't think it would have any effect on shareholders since it belongs to creditors without Molycorp.
There needs to be a buyout for Neo in order to benefit equity holders.
And this has to happen before effective date.
My conclusion:
The only hope for equity holders now is buyout/merger before August 1st this year.
That's it.
per Law360:
"In a separate development Monday, Judge Sontchi approved an Aug. 1 deadline and registration and notification plans for Molycorp creditors who have a choice between a cash settlement of their claims or equity in the surviving company."
ok, I think I found out who owns the Mt.Pass plant. It's Molycorp.
per company news in Mar.31st:
"The confirmed Plan allows Molycorp’s downstream business units, Chemicals & Oxides, Magnequench, and Rare Metals to reorganize under new ownership with a significantly stronger balance sheet. The Plan features a settlement agreement between an affiliate of funds managed by Oaktree Capital Management L.P. (“Oaktree”), a secured creditor, and unsecured creditors, pursuant to which Oaktree will receive 92.5% of the equity and the unsecured creditors will receive 7.5% of the equity in the reorganized company. A settlement also was reached on the purchase through a credit bid by the ad hoc group of the Company’s 10% secured noteholders of the mineral rights and certain intellectual property of Molycorp Minerals (the “Sale”). The ad hoc group of 10% secured noteholders was the last major secured creditor group with which the Company had not reached a settlement in a mediation process that spanned several months.
Molycorp’s Mountain Pass mine was excluded from the Plan, and the equipment and surface property rights at the mine were excluded from the Sale."
What is not clear to me is whether those bondholders own mineral rights only or both mineral/plant in Mt. Pass.
If not, who owns the plant?
Per Law360, "A group of the company’s high-interest noteholder later won approval to buy the mine’s mineral assets in exchange for a $1 million reduction in claims against the Chapter 11 estate. The noteholder group said later that a foreign interest had expressed early interest in the mine, but had not provided a qualifying bid."
and "A Delaware bankruptcy judge sent Molycorp Inc.’s rare earth mine into its own Chapter 11 Monday, severing the idled Mountain Pass, California, site from an already-confirmed plan that restructured the rest of the company and jettisoned most of its $1.7 billion debt.
Judge Christopher S. Sontchi approved the change as Molycorp’s largest creditors continue to work out settlement terms for the mineral company’s surviving national and foreign “Neo” operations.
Spinoffs also include a company that now owns undeveloped mineral rights beneath and around the 2,200-acre California mine, although disputes over terms of that deal already have landed in U.S. District Court."
a company ??
However, If there is/are buyout offers to the newly emerging company (without Mt.Pass) before the effective date starts, shareholders could get something depending on offer. Probably that is the only way commons make out.
I don't know how commons can benefit even if Mt.Pass mine is sold now since it's already transferred from Molycorp to bondholders.
It sounds like Neo and other processing units are lumped together to exit from ch.11 without Mt. Pass mine.
But again Mt. Pass belongs to some groups of bond holders now, so what do shareholders get??
Is it finished for shareholders per today's 8-k?
It doesn't sound like an ordinary regular joe can buy them.
Agreed.
One other thing is that there seems to be two different opinions regarding the section 702(b).
This camp thinks that it actually helps common share holders by not having possible dilution til at least Jan 2018, and really not much effects on Gse's.
The other camp thinks it's a body blow to recap and release efforts.
I remember Mel Watt said recently conservatorship are not sustainable.
If you don't mind, can you please share your thoughts on the effects (Gse jumpstart) to FNF whether positive or negative, maybe neutral?
TIA.
Navy, thanks for sharing your thoughts. I hope it happens like you said.
I was talking about a scenario before jumpstart gse insertion into omnibus budget bill.
My thinking process was that since Mel Watt can't release FNF from consevatorship without US Treasures consent (based on our previous messages) other than receivership, the only incentive for TSY consenting it would be making money by selling their senior preferred shares.
Please let me know because I am probably wrong...
K, you were talking about pps.
Yes, I absolutely agree.
But honestly, I'm not holding my breath anymore by observing US government, Congress, and judicial courts behavior so far.
They are colluding each other it seems for whom they are serving, Wall Street.
I thought Delaware lawsuit was only about illegality of NWS rather than removing Conservatorship.
Please correct me if I'm missing something here.
Okay, so other than liquidation and receivership, Mel Watts really can't release FNF without US TREASURY.
Now, why would Treasury do that without selling their senior preferred shares first? I think we're really stuck until Jan 1st 2018.
That's my take.
Thank you, Obit. And God bless.
I see and thank you.
please let me know other ways, too.
If I understood you correctly, FHFA can only release GSE with US Treasury's consent. Is it right?
Obit:
Do you think US Treasury can recap and release GSE by loaning FNF required capital before Jan.1st 2018, and then sell their preferred shares after Jan.1st 2018? (a way to go around the GSE Jumpstart bill under Omnibus budget)
As long as Gse's in conservatorship, it means not much. Meantime Mel is happy to milk the cash cow at the expense of the shareholders and use it for appeasement. All that money belongs to the shareholders.
It seems that no matter what people say what the right things to do, all these corrupt elite group supposed to serve us and defend constitution have different agenda. That is serving their own interests. I blame all general population who constantly electing the same progressive party.
Remember Mel already said Gse's are not sustainable under consevatorship for long.
S. 2038 is going to prolong conservatorship as long as they can, eventually leave nothing to shareholders common and preferred.
The current lawsuits are about proving illegality of NWS by US Treasury, therefore it's easier for Gse to be released from the government once proven guilty.
BUT S. 2038 squarely puts into Congress no matter what happens in the court. My understanding is that S. 2038 is nothing to do with NWS, in fact it will continue.
Now I just don't see why the cocksucker bill will help common share vs. preferred. Remember he publicly called to short Gse's.
Currently Gse are handcuffed by HERA, but it's like putting a shackles on Gse's feet if jumpstart Gse bill pass. The name is the opposite of what's in it just like Patriot Bill. It's nothing to do with Patriots but doing surveillance of us citizens.
I encourage every long in this board do it. Go to your senator's website. They are automated to write a letter from there. Same for your district congressman.
I believe removing S. 2038 from omnibus is absolutely critical.
I also wrote letters to both senators and a congressman in my distract.
All democrats.
Are you implying that GSE Jumpstart bill would effectively end net worth sweep by US Treasury??
Obit Thank you for your explanation. As usual , you are the man here.
Have a great weekend !!
Obit, If I could ask you one more question,
Last year October, Lambeth said "its not ripe" for Perry lawsuit.
I still don't get it why it's not.
Can you please explain what his reasonings were?
Has the situation changed if it's ripe now?
Thanks again. I always read your posts and impressed.
Obit, thank you so much.
Glad you are a member on this board.
Dear Orbit:
I read thru the article posted by Navy "Why Hindes/Jacobs Plantiffs Will Prevail In The Fane Mae and Freddie Mac Delaware Litigation" posted today.
The author sounds like the Delaware case should be looked at by the Delaware court unlike Lamberth and Pratt's decision to toss out Perry/Continental Western litigations under HERA's blanket cover against any litigation.
Evenif I tried to understand why the author think so, I couldn't grasp exactly how it's different under HERA. Maybe it's because I don't have an enough background to understand legal languages.
Can you please respond in a layman's term what the author is talking about? and Please add your own opinion if you would.
Thanks in advance.