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And the plot thickens! So with an end to exclusivity, does this mean the EC POR is the ONLY game in town now?
Boris Badenov:Those pigs! Those pigs!
Natasha Fatale:Those pigs! Those pigs! What they do, Boris?
Boris Badenov:They took my dynamite.
Natasha Fatale:Those pigs! Those pigs!
http://www.imdb.com/title/tt0101500/
I think I will order this movie, have some brewski's and watch it to see how it turns out!
Great analysis as usual, MC. It is greatly appreciated and your skills and perspectives are very highly respected. Hope all is well with the family.
Never underestimate the power of the "little" people. That's how the oil business got started in their big restructuring that started in 1980. I've lived it, and I see some similarities here and now.
Negligible volume traded today.
I saw somewhere on the 'net that the unofficial expected date for the q2 2010 report was Aug 9 2010.
Scottrade lists the following as peer companies
Market Capitalization for CEMJQ
Compare Peer Market Capitalization
EMN 4.1B
ALB 3.8B
FMC 4.3B
CYT 2.1B
CEMJQ is considered a Small Cap stock with a market capitalization of $151.8M. Market capitalization is calculated by taking the total shares outstanding multiplied by the current market price.
P/E Ratio for CEMJQ
Compare Peer P/E Ratio
EMN 17.6x
ALB 17.8x
FMC 17.1x
CYT 98.7x
The P/E Ratio shows how much investors are willing to pay per dollar of a company's earnings. Higher future earnings growth is expected when a company has a high P/E ratio compared to companies with lower P/E ratios. The P/E Ratio shows how much investors are willing to pay per dollar of a company's earnings. Higher future earnings growth is expected when a company has a high P/E ratio compared to companies with lower P/E ratios.
Beta Coefficient for CEMJQ
Compare Peer Beta
EMN 1.8
ALB 1.5
FMC 1.0
CYT 1.7
A measure of a stock's volatility relative to a benchmark, usually the S&P 500 which has a beta of 1. Beta is also known as systematic risk. The Beta Coefficient for CEMJQ is 125.83
There might be a little strategic synergy with FMC or ALB of these peers, but I see more with CBT, more business lines that are compatible with CEMJQ businesses, but different niche so that has some integration potential. Don't see much with ASH, or Dupont. Dow is ridiculously huge, with a lot of cash on hand, some possible synergy there. This all is just IMHO.
Relative to any of these, CEMJQ is ridiculously low now.
yeah, but it would be kinda like kissing your sister maybe a little too easy and might not go very far. Cabot (CBT) on the other hand....they might use this to finally get some better traction.
Down in the underpinnings of our nation and beneath the laws of the USA and many other nations lies the ancient wisdom as follows:
1 The sayings of King Lemuel—an oracle [a] his mother taught him:
2 "O my son, O son of my womb,
O son of my vows,
3 do not spend your strength on women,
your vigor on those who ruin kings.
4 "It is not for kings, O Lemuel—
not for kings to drink wine,
not for rulers to crave beer,
5 lest they drink and forget what the law decrees,
and deprive all the oppressed of their rights.
6 Give beer to those who are perishing,
wine to those who are in anguish;
7 let them drink and forget their poverty
and remember their misery no more.
8 "Speak up for those who cannot speak for themselves,
for the rights of all who are destitute.
9 Speak up and judge fairly;
defend the rights of the poor and needy."
Proverbs 31:1-9
I do not think Judge Gerber will forget this.
According to Scottrade:
Market Capitalization for CEMJQ
Compare Peer Market Capitalization
EMN 4.1B
ALB 3.8B
FMC 4.3B
CYT 2.1B
CEMJQ is considered a Small Cap stock with a market capitalization of $161.6M. Market capitalization is calculated by taking the total shares outstanding multiplied by the current market price of one share.
What a hoot!
And I want one too!
Lotsa volume so far
It will be a wild ride from here, no doubt. There will be some downs, expect them but realize that they are probably not the end of the story. The reason why....truth is the hardest thing to hide folks, it has a way of seeping out eventually no matter how deep you bury it.
Gerber's gonna have some fun and cut loose some classic one-liners this time around, I can just feel it. If that's the case folks it is time to kick those tires, light the fires and strap in tight. Those who can't decide to get in need to stand back 'cuz this thing is about to take off.
CEMM, I bet your book will be a thrilla! Hollywood's been outa material for too long, an that'll be just what the doctor ordered!
Definitely agree with your comments on the POR's.
They cater to Hedge Funds & Institutionals.
https://wwwca01.btig.com/
Killer Whale Siting, I'd say.
Yea, and Goffman's got real bullets in his.
Sorry, I was away helping a son in need this weekend. There have been a lot of great posts here. I agree with your comment about the bond prices. We may well see that trend continue, and our stock go up.
My pirate comment wasn't meant to indicate any "equity" blood was in the water, but rather that of the creditors and to some extent the management who supported this POR. The valuation vs liability equation is being played carefully to manipute for a wholesale change of control of the company, and in the debate of competing POR's, some mendacity may be exposed. When you dilute existing shares by over 95% in favor of a new set of stockholders it makes it possible to get an entirely different board and make a lot of simultaneous wholesale changes in corporate governance. Many on this board have said this was the agenda for a long time, and that debate could bring it into the spotlight.
I agree with your comments, that they are doing everything that they can to dilute value and the voting rights of the existing shares to leverage the fight in their favor. I think Chemtura's disclosures may be based on some spun numbers, and this is why they are careful to say the numbers are unaudited, that they have not provided a comprehensive description of their liability protection via insurance, and why they are using the unresolved Diacetyl and Environmental Claims to perhaps inflate the liability side of the equation.
It could be entertaining if/when the exclusivity is ended and the competing proposals are compared which may prompt some probing questions that will have to be answered completely and truthfully.
I think we have great potential to end up well above any recently spoken expectations on the share price, and am confident that the factors that really matter will ultimately be proven to be on our side, despite the continued attempts to suppress and dilute them. Those attempts have consistently failed so far, marketplace trends are not favorable for them, and after this there aren't a lot of new tricks available to the creditors and debtors.
I am grateful to those who tallied the shares, coordinated the communications, and those who where chosen to serve on the EC (some may recall my name was also on the list who volunteered to serve). I think this would be a great entry point in the stock, but I already did many months agon, and it has been a wonderful ride. The next 60 days should be very interesting.
Boris Badenov: Those pigs! Those pigs!
Natasha Fatale: Those pigs! Those pigs! What they do, Boris?
Boris Badenov: EC took my dynamite.
Natasha Fatale: Those pigs! Those pigs!
I think I might be worried about ending up in a drum if I were him. One of the quickest ways to get a ship torpedoed is to have a pirate at the helm.
He may realize he doesn't have a job or a KEIP in time. The whole bankruptcy case and all the rulings could potentially be cancelled if I am reading the explantions of the law right (and I am not a lawyer).
They other possiblity is, if I read correctly, he could even be replaced by a trustee if necessary.
So I guess they are concluding the post-petition equity can be treated the same as post petition debt can? How can that be so?
In reading that below, this is an extremely desperate and dangerous move for CEMJQ and K&E to take, given some of the possible outcomes. With the health of the business is certainly seems unwarranted to me.
Excerpt from Wikipedia on chapter 11 bankruptcy:
Debtors in Chapter 11 have the exclusive right to propose a plan of reorganization for a period of time (in most cases 120 days). After that time has elapsed, creditors may also propose plans. Plans must satisfy a number of criteria in order to be "confirmed" by the bankruptcy court. Among other things, creditors must vote to approve the plan of reorganization. If a plan cannot be confirmed, the court may either convert the case to a liquidation under Chapter 7, or, if in the best interests of the creditors and the estate, the case may be dismissed resulting in a return to the status quo before bankruptcy. If the case is dismissed, creditors will look to non-bankruptcy law in order to satisfy their claims.
Automatic stay
As with other forms of bankruptcy, petitions filed under Chapter 11 invoke the automatic stay of § 362. The automatic stay requires all creditors to cease collection attempts, and makes many post-petition debt collection efforts void or voidable. Under some circumstances, creditors or the United States Trustee can ask the court to convert the case to a liquidation under Chapter 7, or to appoint a trustee to manage the debtor's business. The court will grant a motion to convert to Chapter 7 or appoint a trustee if either of these actions is in the best interest of all creditors. Sometimes a company will liquidate under Chapter 11, in which the pre-existing management may be able to help get a higher price for divisions or other assets than a Chapter 7 liquidation would be likely to achieve. Appointment of a trustee requires some wrongdoing or gross mismanagement on the part of existing management and is relatively rare.
http://en.wikipedia.org/wiki/Chapter_11,_Title_11,_United_States_Code
Evil Bad Natasha!
Natasha Fatale: You are so bad, you're good!
Boris (Craig) Badenov: It's good to be bad!
I hope somebody is calling the SEC to prosecute this as fraud. There was no prior class distiction between pre and post CH11 filing shares. All were converted and are the same shares, since when do distinctions of date and purchase price determine treatment of shares? Is this still the USA where the rule of law is supposed to matter? This should be prosecuted in light of Rogerson's remarks since BK.
I think Judge Gerber will open that Can of Whoopass the EC has for the debtors. Go Goffman Go!
That is how I see it. They are imaginative though, aren't they? I guess the bankruptcy process can put the creditors in a superior position, but not always.
I found this to be very interesting:
http://mmpiequitycommittee.blogspot.com/
Imagination is one of those freely available things that can be a key ingredient to our success too.
Or? There are other options, and I respect that as his business. We are each the captains of our own destiny.
Guys, this company has a functinal monopoly on some very strategic products. Even if the EC fails, this stock will pop shortly after it exits BK, IMHO and the value will be more than it is today. There is a lot of upside from here.
I for one do not think the EC will fail. Creditors, bondholders are in that position because they wanted to limit risk, and so they contractually are entitled to the face value plus interest. Anything more is beyond what was agreed to, and they really have no right to ask for more than that. Of course, recognizing the value, they would rather get a nice free ride with a great deal on payment with equity....and that is selfishily attractive to the CEM managers because it reduces their debt and enables them to build their empire(but that can backfire in a short period of time if it happens at an unwise pace)...but CEM management have no right to expect that sort of imbalance at the price of equity either. The consequence of that is to to screw retirees, employees, and other stockholders (and clearly there has some fearmongering in the past that served that purpose-as is occurring now IMHO) It is my personal view, and my personal funds are betting that this judge is probably too wise to somehow be conviced that this is right for all (or even any of) the parties in the long run.
The questions are, as MC so eloquently stated is really where on the scale of debt to equity leverage the company will exit BK with relative to it's peer group and also how the EC financing is structured. It is in everyone's interest that it is a vigorous and health enterprise, and that it is also a responsible one. If debt is too low or high relative to it's peers, it can cause some undesirable imbalances in the marketplace with unintended consequences. Let's control our emotions and watch and learn.
Jun 28, 2010 (Wall Street Horizon via COMTEX) --
Chemtura Corporation (CEMJQ.PK)
Expected next earnings release:
Announcement date: 8/9/2010 - After Market
Earnings Quarter: Q2
Announcement Status: Unconfirmed
It became "Motors Liquidation Company" which sold assets to New GM Company (Guvanmint Motors) and others. It was a pre-packaged wham-bam, different animal than what we have here.
http://en.wikipedia.org/wiki/General_Motors_Chapter_11_reorganization
Just as it would be his right to buy. It's his business.
Wasn't aware, but suspected as much. He could not still be on the EC and talking like that. Still appreciate the man, his efforts, can't speak to capabilities or reasons why...that is really his private business. We all have our own challenges, pressure points and capacities that never should be subject to judgement by others because they were not in the arena.
here's a tribute from long ago written by a worthy man.
http://www.theodore-roosevelt.com/trsorbonnespeech.html
Like I said before, I'm in until the fat lady sings. Goffman hasn't yet had his chance to illuminate the valuation issues, and I note that the disclosure document, though voluminous isn't really very clear, such as the Diacetal claims (tort liability), insurance, or where the other unaudited numbers actually came from that were used in the POR valuation.
Intrinsic value can be defined simply: It is the discounted value of the cash that can be taken out of a business during its remaining life. The calculation of intrinsic value, though, is not so simple. As our definition suggests, intrinsic value is an estimate rather than a precise figure, and it is additionally an estimate that must be changed if interest rates move or forecasts of future cash flows are revised.
The Essays of Warren Buffett : Lessons for Corporate America (2001), p. 200
Over the years, Charlie and I have observed many accounting-based frauds of staggering size. Few of the perpetrators have been punished; many have not even been censured. It has been far safer to steal large sums with pen than small sums with a gun.
The Essays of Warren Buffett : Lessons for Corporate America (2001), p. 210
You only find out who is swimming naked when the tide goes out.
Berkshire Hathaway 2001 Chairman's Letter
Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when others are greedy and greedy when others are fearful.
Berkshire Hathaway 2004 Chairman's Letter
Long ago, Sir Isaac Newton gave us three laws of motion, which were the work of genius. But Sir Isaac's talents didn't extend to investing: He lost a bundle in the South Sea Bubble, explaining later, 'I can calculate the movement of the stars, but not the madness of men.' If he had not been traumatized by this loss, Sir Isaac might well have gone on to discover the Fourth Law of Motion: For investors as a whole, returns decrease as motion increases.
Berkshire Hathaway 2005 Chairman's Letter
Well, there has been buying at the ask price. What does that say?
Not!
G2, thanks for the pm. Great advice.
Awesome! Here's a video of my ride.
Go look at the 2 year price/volume chart. Relatively speaking, it looks to me like there hasn't been that much volume in this very quick major price drop. Certainly not anything like what happened in early 2009.
My divorce is finally going to trial, so a stampeded herd is not entirely a bad thing for me, frankly. It's always better to get divorced as a poor man, I even have just enough time to revise my sworn inventory.
Capitulation is a good thing after it is over with. Seems to me that there are stronger hands buying the stock even now, and they have been for a long time since we were at twice the price. Maybe they know something. No disrespect to anyone who wants to sell.
Right or wrong, we are each the captains of our own ship. I'm not selling or drinking any koolade.
WS, man I'm sorry for what this has done to you if you are him, and frankly, I am beginning to wonder if you are. IF you are him, go fishin', punch some cows or do whatever lets you mind let loose for a while.