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The auction back in December was cancelled because the deadline passed and no there was only the one qualified bidder, which was Marquee, so they won by default.
You do some great research and have made only quality insights so I'm rather surprised you didn't see this scoop. Did you buy shares after the asset sale?
You are correct, however it needs to be said also that we are talking about only one sale at about 9:44 AM for 300,000 shares or $7,000 in value. The way you make it sound, it was an all day sellathon, and that is simply not true at all. Neither would it be true to say it was a good day, I'm just trying to bring some balance to the perspective. The recent events have been far too insignificant, relatively to draw a lot of conclusions from. We've had no notable catalysts since the event where the 0.05 support/floor broke about half an hour after the closed door auction was abruptly cancelled.
Recap of today's trades:
9:33:18, 10,000 @ 0.0198
9:35:23, 2,650 @ 0.0200
9:44:25, 10,000 @ 0.0200
9:44:35, 50,000 @ 0.0199
9:44:47, 10,000 @ 0.0199
9:44:54, 166,517 @ 0.0198
9:44:57, 67,179 @ 0.0192
9:45:00, 50,000 @ 0.0190
9:45:01, 12,821 @ 0.0151
10:14:06, 1,000 @ 0.01895
What you're describing, I'm not familiar with reverse mergers. Is it still theoretically possible for us to get to $1+? That would right a lot of wrongs, wouldn't it!
Welcome back! Of course, the best time to buy may be when fear has caused holders to flee. With the prevailing attitude of the market being quite different from our long view however, I wonder if the book value might in fact be a negative number. And I wonder what the true low will be or if we have already seen it. Note that the 0.0245 all time low has recently eroded to 0.019 as of yesterday, and today become as low as 0.015. A lot of would be investors appear to be waiting on the sidelines for some signal that the downtrends have reversed before assuming this is a safe buy. I have to admit I'm not much of a chart reading person, I tend to look more at the fundamentals on the balance sheet and the status of the reorg plan to plot out where this is headed. What do you think about the recent court filings, for instance?
Generally speaking these signals and instincts were the same from my perspective. With the prevailing attitude of the market being quite different however, plus taking into account its negative book value, the timing of the bottom bounce has proven quite difficult. The 0.0245 all time low quickly eroded to 0.02 which has become as low as 0.015. It has been beaten down by naked selling, and the low volume means they think they can control us.
I hope our instincts are correct. While there would seem to be an endless supply of shares on the ask ever since it dropped below 0.04 with news that the auction had been cancelled, the momentum against us should eventually run out of steam. We need some sort of boost from the courts like carving out a bit of the NOL's value for us as you have speculated, or if the final sale price, with inventory adjustments comes out more favorable because of what the sellers have negotiated during that bid process. It's not as though this has much real assets value to stand on anymore, but there could be perceived value in the NOLs which were not recorded as part of its negative BV.
Thank you for posting your BV calculations every day to keep us in the loop with what's going on in there. But I am fairly certain that the BV will not end up being negative, nor will it be $14 when all is said and done. They would not have been eligible to even file Ch11, let alone approved so quickly, if that were the case. Maybe somewhere in between.
Thank you for your observations on DESTQ. I find myself aligned with your very thoughtful and comprehensive scenarios. Today as you know can be a pivotal moment in the process because they are meeting, but as far as when and how this company will take shape, there is no known quantity yet. Since it now appears to be priced in to fail, I remain cautiously optimistic that there could be a new leaf unturned when the POR actually comes to fruition. I am long 22,000 shares and staying tuned for news.
While there has been no real news about the outcome of the department stores (Macy's, etc.), my understanding was the standalone stores are all going to be gone within months. I have seen no indication that a core of stores would survive or somehow reorganize, have you? All of the press releases show Marquee going forward with the online brand. This appears to be a different overall outcome from Aeropostale, for instance, which has kept some of its stores open in bankruptcy under its new ownership, Simon Malls.
It's a shakedown, and it's rather predictable. Volume is scant. The huge ask wall sets up for days at 0.03 and then waits for impatient sellers to give up shares. We've seen this before in the days leading up to news. I share most of your sentiments that this has some hidden value left to unlock. Hoping that they announce soon how much real value they were able to cobble together by selling off the assets.
Valid point.
I am still wondering what scenarios we need to get more buyers. Volume each day has been anemic. I'll tell you what it isn't going to happen. It's not going to just wake up one day and be a dollar fitty, or a million shares traded. We would need a real "surprise" action in the courts to protect the investors or at the very least a rumor of a plan to turn a profit on this. Liquidation sales in stores are not going to create a cash flow that exceeds the court expenses. Sadly, our prime opportunity to get this going in December was wasted when counterbidders avoided the auction and they had to cancel said auction.
Digesting today's filing in court. The unsecured creditors were not happy that Pathlight was given a make whole settlement and have asked it be reduced by 50%. The courts have ordered Pathlight to pay back the settlement. Looks like a short term win but long term pretty bleak as the same filing refers to DEST management as "insolvent."
A Feb 20 Omnibus hearing has been scheduled for 10AM.
Store had its closing sale near me. I popped right around the final week of December to check on volume but there was not a lot of movement. I may swing by tonight to get a read on things.
Just confirming you meant $0.10+ per share, right? Stupid autocorrect!
The company stated on October 21 of 2019 a disclaimer about worthlessness of common stock. When the anticipated "second bidder" did not materialize it means that we do not necessarily have the assets to cover our $89M in debts. As many have pointed out, the only saving grace at this time appears to be if the buying party assumes enough liabilities and carved out a little something for the shareholders to make the sale binding. Those documents are sealed so we don't know. It is very possible given the nature of the negotiations that there's as much as $0.56 per share in there as a payout but it really depends on unknown quantities at this point. Trust the lawyers and the board? These are the guys that bluffed about "24 bidders" when only really two were actually really sniffing around negotiating offers. These are the guys that allowed the precise list of debts to be shrouded in practical obscurity (some overstatements, others not stated correctly or at all) until after the auction. All of this is my opinion and everyone brings their own perspectives to the table and I welcome all discussion on these matters. NOT trying to throw a wet blanket on it but there is some cause for concern about the overall lack of clear communication from the company during this trial.
This article spells out the shareholders' challenges which may be encountered while recovering any final value from a bankrupt and/or "liquidation" stock such as but not limited to DESTQ.
https://observer.com/2017/02/court-of-appeals-ninth-circuit-shareholder-bankruptcy-rights/
It's these lawyers you mean... How they could be so two-faced, giving us seeds of hope while simultaneously selling us out for a measly $50M? I would suppose it comes with the territory. Of course they get paid either way. I might have finally caught onto their ruse but already after my investment had lost almost 50%, and I waited too long to see the true signals. At least I have my sanity still, and have not lost that.
Do you think we could put aside our differences, band together and put pressure on this company to start conveying value upon the loyal shareholders?
EOD orders often come at a discount and buy to open comes at a premium for the buyer. That is how the MM's can make big spreads on a penny stock. Whether up or down, they cover their losses and stay risk free throughout their position while we assume too much of the risk. I hope you have a good weekend and thanks for sharing your real perspectives with us.
IMO we, the US and the judge were all sold a bill of goods. No sooner than the Company's lawyer represented that the bidding was very active and that the first round of bidding was not going to be detrimental to the auction, because after all there were 24 bidders lining up, then the auction was cancelled "the day of" as there were all of a sudden, somehow no competing bids.
Meanwhile, the mods here have an obvious agenda and are squashing any kind of rational thought or counterargument.
Furthermore, they said there was a competing bid (ONE) but it just fell apart at the last minute. (Whether or not conflicts of interest were getting in the way, it can easily be presumed there were some conflicts.) And furthermore, they used the notion of an increased bid to try to appease the judge to rush the part sale / part liquidation through on time. But recently I have not seen anything in court documents officially reflecting that concession was even finalized. I want to know where the $8 MILLION is and whether shareholders will be seeing any. The rapid sell-off yesterday morning seems to be an indicator that somebody heard something in court that did not help shareholders.
My reaction to the piece is to wonder why the previous conversations about Marquee's having increased the original bid to satisfy the judge's concerns seems to now be scrubbed out of the narrative. It may be an oversight on the part of the reporters but I have seen incomplete evidence in the transcripts alluding to an increased bid. Since the bid increase could have resulted in anywhere from $0.00 up to $0.56 in additional shareholder returns, I don't think this detail is moot and I really expected to by now have more tangible information available as well as to know what approximate debts to assets ratio we can expect to see when the sale closes "by the end of the year."
My prediction, stock will have a morning pop back to 0.0325 area as news of the sale surfaces, but then continue to sell off below 0.03 into the weekend.
Another observation, there were numerous sellers around the 10 AM hour this morning driving it below 0.03, so I was pleasantly surprised to find no negative information in the court documents after my first impression that somebody must have heard something they did not like.
Thanks for the alert. Below is excerpted from the article.
I'll happily keep doing the moderators' job as long as we're here.
New alert came in, can you help us expand the discussion since you have been tracking this case in law360?
The sale hearing was scheduled for today at 9:00.
https://cases.primeclerk.com/DestinationMaternity/Home-DownloadPDF?id1=MTI4NjUzMA==&id2=0
Today's expected final approval of the asset sale should provide some much needed clarity for all. Self important fake mods can sell for 0.03 today and then pretend to have been blindsided by DESTQ like the rest of you even as they were contributing lies to you and tamping down dozens of evidence I had posted.
Good luck to all.
If someone said "far from over... 21 bidders" and then there was radio silence, someone ought to provide a "reality check" against these assumptions. Even when I was bullish as hell and providing daily updates from the court filings that seemed to be going in our favor, I would ask practical questions of this forum like are we sure we would still have enough assets after paying off mounting debts, to get paid? I think that was relevant question as all the secured and unsecured claimants continued to line up?
And I wanted us to account for two line of credit loans that immediately defaulted when we filed Chapter 11. I provided these concerns not to keep the price down but to keep everyone's awareness up. A few have thanked me publicly for getting out at 0.07 or not testing the water at 0.06. I myself took a long position but I did so while calculating the short term risks.
Today's expected final approval of the asset sale should provide some much needed clarity for all (though we may not have document until after hours, occasionally news will leak from reports). The final booking of the sale could be the final catalyst if you will. And I think that should be the prevailing narrative, not that some secret bidder is going to swoop in and try to take the bid over from Marquee. It's clear to anyone that the two active mods want to tamp down negative news because of the apparent conflict of interest they have as shareholders.
The planned auction since officially cancelled the day of, may have been the company's last bluff. Up until this sudden departure from the plan, I suppose we all have just been pinning our hopes on a bidder that would come out for it at the last minute which could have raised their stake to $60M ~ $100M. But unfortunately I believe Destination Maternity's best attempts failed to capture a better value than the known 50M ~ 58M bid that came late in the game.
The info that was filed in the courts on Dec 11 confirmed our latest suspicions about the nature of the auction and its 24 bidders, most of whom were not actually heard from by the deadline. Quite apparently, only one group was sniffing around before the deadline, and ultimately decided not to even meet the terms requested. I read this to mean that the elusive second bidders may have been willing to match the offer but not pay additional incentives to include the break-up fees. Or it could have been that they were willing to appear at the auction to counter the bid but made no commitment to a specific dollar amount in advance. This is in direct opposition to the company's claims that the break-up fees would not "chill the bidding" activity. Nobody at all besides the stalking horse took the company bait.
The asshat cant delete this
Now I'll be sticking posts if anyone wants to add to the discussion, so please feel welcome to add your own two cents. It's been so much to digest in the past three weeks. I encourage everyone to continue to pursue the court documents for any mention of shareholder relief in case I missed some key relevant details. I do read everything that comes out but it is a lot to sift through and much of it can be repetitive and much of it can have no immediate effect on PPS because aside from the occasional surprise, mostly everything that comes out after awhile is already expected news.
The auction was not cancelled? These are not my made up words. "The Auction is Cancelled" is the actual phrase from the actual court filing dated on Monday Dec 9th. Beat writers and other stock followers have read easy inferences into that news that there were no qualified competing bids besides the one revision from 50M to ~58M.
That prevailing suspicion was confirmed in today's filing by the debtors:
No, we're cool.
You know that I was referring to this particular statement about the 21 bidders. No need to call it what it isn't anymore, I agree. I just wonder why I'm the only one being corrected. You can also see the wires picked up right away that the cancellation had everything to do with them not getting bidders.
21 bidders... but only one sent in bids for the proposed auction, so that auction was cancelled.
Why would you even post an alternative scenario to Marquee Brands winning the sale? The sale will be finalized tomorrow. (Unless the judge steps in and nullifies the sale. There is also the possibility that the sale will be delayed only if there are conditions that need to be met.)
The original poster never even referred to that document #99-02 which someone is still insisting never existed.
Yesterday same someone stated that we would have 20 bidders in an auction that never took place.
About that auction, Destination Maternity's official position was that the stalking horse bidder would not chill bidding at an auction. They then cancelled said auction because they did not receive any additional qualified bids. I hope the judge admonishes them for this apparent change of story which took place over the course of two days.
When I see a changed story like that I can immediately sense that I've been lied to all along, but unfortunately some fiercely loyal friends will double down on their lack of evidence and not admit they were scammed.
I can't wait to see what tomorrow will bring. Stay tuned!
Welcome to the board. I do not know if you were referring to DEST filing a declaration of worthlessness of common shares, which was called exhibit number 99-02 on October 21, 2019? I suppose that you did not know these documents are regular procedure. They generally have to be filed publicly in order to avoid lawsuits by people who claim that they were sold shares of the company based on positive news and they were never warned of the possibility of a cancellation. "The company never told me it would not survive / was worthless, I want my stake of the new company now!" would not be a valid claim in court and these lawsuits would get thrown out, whether filed by existing lifetime shareholders, or johnny come latelies who stumbled into the stock because they heard the company was for sale and that it was going to make millions again in the future as some kind of a merger or restructured organization. As you might imagine, all sorts of this is one of a kind rumors are prevalent whenever buyouts are being negotiated.
About bankruptcies in general, I have read in the MotleyFool's column on nasdaq.com pertaining to this subject that commons often get wiped out in Chapter 11 bankruptcy. It doesn't say always, because there are notable exceptions to this rule. Occasionally restructuring and buyouts do carve out value for existing shareholders in the new company. In the short term there have also been numerous profit opportunities in BK stocks due to the volatility, but there is also the possibility of total loss when the music stops. This particular stock DESTQ spiked from 0.042 to 0.1053 when news came out of a sale of the company assets on December 1-2. For the savvy investor, that kind of a swing can create a very quick ~150% profit in a matter of two trading days!
This maybe occurs when somebody (like me, perhaps) sold it to you at your low bid instead of you paying the higher ask. For every transaction there is a buyer and a seller. However, it's all about the strike price, what color they make it.
PS: This is my final post of the day on this matter, as yes I am no longer a shareholder of DESTQ. It's been fun playing the odds with you guys. That morning we woke up to a gap up was fun. Sadly, we didn't get the auction today and we didn't get to extend the run. That's disappointing, but there's next time. Good luck to all.
Important clarification: They cancelled the asset auction, not the bankruptcy!
Would have said swear word but don't want to get banned.
I wish I could say this is the first time I've been hoodwinked by a BK play but they're almost all the same. Faux optimism, followed by rug swept out from under me.
Crumbs! Now the selling comes.
No selloff observed as of yet. The market seems almost indifferent to the news, even though it means as many as 20 bidders stepping away from the plate.
My expectation: After hours news will be issued confirming the final sale amount as well as other pertinent sale details. There may not be a whole lot of trade volume expected until that happens.
Nothing apparently. But it does hit the reset button on a lot of fake claims that have been circulating. And that has been welcome relief, IMO.
Destination Maternity Shutdown Looms as Marquee Brands Bid Wins
https://www.bloomberg.com/news/articles/2019-12-09/destination-maternity-shutdown-looms-as-marquee-brands-bid-wins
Next catalyst: December 12 is the court approval of the sale. I expect this should go swimmingly, because the judge already weighed in on the Asset Purchase Agreement, and it was revised to meet his demands, and they would not have cancelled the auction and declared a winner if they had no record of sale that would pass approval.