Dime Bancorp Inc (fka DIMEQ)

[CDrucker]

Thanks Jared,

Now for the next question.

Continuing with this worst case scenario (that we are deemed equity) - or maybe it's not the worst case after all ;)


Messages on the Wamu yahoo board claim that newco also gets $17.7BB in WMI's Net Operating Losses (NOL's). bopfan suggest this is a secret tax asset that is worth a lot. Well, I challenged her on that because I didn't believe it and bopfan gave me an interesting article about how Wells Fargo bought Wachovia and got to use an annual amount of their NOL's equal to the total NOL value divided by Tax Exempt Bond Rate.

http://messages.finance.yahoo.com/Business_%26_Finance/Investments/Stocks_%28A_to_Z%29/Stocks_W/threadview?bn=86316&tid=894478&mid=894622

http://www.wamu-shareholders-resources.com/documents/irsNotice2008-83-final.pdf


Well, if that article is true and applicable to us, then, assuming a best case 20 yr NOL lifespan, 35% tax rate, and that we get 74% of the common equity pot, which is 30% of Newco (ie, 30% of the NOLS); then my math estimate the NOLs are worth up to $2.48BB to an acquirer of Newco, of which the LTW's share would have a full value (max, best case) worth of $550 MM, or a whopping $4.87 / LTW.

Now, I don't expect that, as I'm not convinced it would legally for us like this, but, I think there is merit to discussing if these $17.7BB of WMI NOLs really do have any value and if they would come to common equity, thus us, if we are deemed equity.

Perhaps some of the expertise on this board could shed some light?