hotmeat, if a buyout happens, it WILL BE WMIH-Corp buying KKR in order to preserve potentially far more billions than the six billion discussed. Read on please.
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KKR/WMIH – Merge with WMIH Being the Survivor?
Let us start this subject by going back to the “Effective Date” which was March 19, 2012 when WMIH was able to leave the bankruptcy court with “Fresh Start” accounting. They also had 200M outstanding common shares (no preferred) from the finalization of signed releases from final amended POR7.
• Remember WMIH said “we believe there was an ownership change” but it was very narrow
• If ownership change or not could make the difference in billions of tax attributes
• The ownership change was within .025% or less “tens of thousands” of shares
• How can one say “we believe” rather than there was or was not an ownership change
• The ownership change is very important as I tie this together toward the end
• Now remember the Denied Claims Reserve (DCR) set up to pay claims & other
• The DCR started with around 5M NewCo/WMIH shares
• There have been a couple of distributions to Escrow ShareMarkers from the DCR
• Currently there is about 1.5M NewCo/WMIH shares left in DCR
• Then around year 2014 KKR came aboard WMIH with their first of three bites of WMIH apple
• WMIH first raised/closed on 600 funding on 1/5/2015 – Help from Citi/KKR
• From “Effective Date” of 3/19/2012, WMIH NEVER tried to buy anything-Just excuses
• In year 2015 the WMIH SHM was scheduled for June/2015 but moved up to April/2015
• We thought and later confirmed WMIH was trying to move ahead in Summer of 2015
• WMIH also took on 2 new Executives specialized in distress debt and MBS areas
• They were offered 1.777M NewCo/WMIH shares upon completion of a minimum 450M QA
• On 10/13/2015 WMIH issued 8K stating unable to complete QA spending 11M – Refused details
• First ever conference call by KKR 3/21/2017 discussing removal of Davis adding KKR Executives
• KKR added this will be effective on 6/1/2017 with KKR taking their second bite of the WMIH apple
• On before 12/08/2017 WMIH dissolves four subs including WaMu 1031 Exchange
• Fast expiring funding is renewed on 12/08/2017 to be effective on 1/5/2018
• This gives KKR more control, better terms and their third bite of the WMIH apple
• Why would KKR keep upping their control, investment in a worthless WMIH shell
• Early Jan/2018 WMIH closes WMIIC – appears to open Delaware Statutory Trusts or DSTs
• DSTs are nothing but 1031 Exchanges on steroids so actions happening between 12/2017-18
• Now it appears KKR is firmly in control for their next actions – What could this be as 1/5/2018 passes and new funding now effective
• Maybe KKR/WMIH merger BUT in order for all tax attributes to be usable WMIH must survive
• From the quarterly 13-F filings, change total KKR held by JPM
1Q 2014 129,483
2Q 2014 387,273
3Q 2014 80,391
4Q 2014 1,677,047
+ 95,000 call options
1Q 2015 246,655
2Q 2015 + 1,701,366 1,948,291
3Q 2015 - 1,555,379 392,912
4Q 2015 + 1,299,496 1,692,408
1Q 2016 - 1,290,830 401,578
2Q 2016 + 31,671 433,249
3Q 2016 + 1,096,709 1,529,958
4Q 2016 - 13,004 1,516,954
1Q 2017 - 608,525 908,429
2Q 2017 + 4,220,481 5,128,910
3Q 2017 + 3,024,021 8,153,111
4Q 2017 -- not yet reported –
• WMIH bankruptcy case NOT closed yet-when last of 1.5M NewCo/WMIH shares distributed sometime BEFORE closure
• When bankruptcy case closed, WMIH files (maybe) with IRS advising there was NOT an ownership change
• No change due to the original shares going back to original owners who signed releases
• Thus, the last 1.5 million NewCo/WMIH makes the difference in ownership change
• With this difference, there could be “tens of billions" in more various tax attributes to use if WMIH survives
• I do believe WMIH will have some sort of Beneficial Ownership in former Estate giving NewCo/WMIH some sort of future value
• Now WMIH becomes the new JPM doing the US Governments bidding – other possibilities
• This could explain the many delays, purposely managed lower WMIH stock price and purposeful triggering the delisting minimum price issue
• Something must happen with KKR wanting three very big bites of the WMIH apple – What is it
• Billions in tax attributes may make a huge difference in KKR allowing WMIH to be the survivor
• So discounting a Tender Offer, obviously, not growing organically maybe KKR/WMIH merger
• Now only filings and then time passing will show the truth behind KKRs/WMIH actions
