Short Term Trading Member Forum

[Jerry Olson]

10 MBI MBIA Inc: Follow up on Buffett offer for bond insurers (13.58 ) -Update-

As mentioned at 8:03, CNBC reports that Warren Buffet sent an offer to the three biggest bond insurers last week -- ABK, MBI and FGIC -- -- offering to reinsure their municipal bonds. Says the offer extends to ABK, MBI & FGIC. Says they would add $5 bln to resources, pledging there would be no distributions/mgmt fees taken for 10 years. Offered to take over the liability for the whole $800 bln of these three cos, for a premium of 1.5 times the remaining premium left over the life of the bonds. Buffet will give the insurers 30 days to find a better offer... Buffett ays as of last night, they were turned down by one of the bond insurers, and they hadn't heard from the other two, so he doesn't think they were leaping for the door to say yes to them.