American Midstream Partners LP (AMID)

[stargazer123]

This is what a commentator is saying.

ArcLight is a general partner of American Midstream (AMID), and owns a fair amount of AMID shares. Analysts have calculated that AMID, over the medium, to long term, is worth $10 - $12, and then up. ArcLight did not want to wait that long, and worked to depress the unit price as much as possible before making its offer to buy the partnership at the ridiculous price of $6.10. It can then take AMID private and move to sell its parts etc., and make up to a quick double on its investment, even though this will mean that it will cause the present holders of AMID stock to suffer a 50% loss.

Ethical behavior would have dictated a public auction and sale of the limited partnership assets (or some sort of recapitalization followed by a return to growth) that would have allowed current stock holders to realize getting a price closer to AMID's intrinsic value.

Clearly ArcLight went for the maximum profit plan and set the ethics part aside. This is something that potential long-term holders should keep in mind for any future ArcLight-led ventures that are potential investments.

The commentator does not think that other companies will step up with a higher bid. He does say that Arclight might increase its bid by 10% to 15%, which would bring its offer to the range of $6.70 to $7.00 dollars.

If another bidder does come forward, it would be at a higher price, so you might want to hold on and see what happens. The price probably won't fall that much while you wait to see if a higher bid shows up. Friday the stock closed close to the $6.70 price. I don't think that another bidder will come forward. I will see what happens Monday. Try to give it at least a few hours, but if it starts edging down, I will sell my shares. My average price, even with having bought more shares when it got clobbered, is $11, so I would take a big hit, but I will move on. There are a lot of good values out there, and I believe that I will eventually make up my loss, and then some.