Trident Microsystems, Inc.(fka TRIDQ)

[mrholty]

Trident Microsystems Equity Committee Files Motion for Rule 2004 Examination of NXP

http://thediligentinvestor.blogspot.com/2012/05/trident-microsystems-equity-committee.html

My comment: Based on my math I get FV for the stock in the $.40-$.45 range with their two large divisions sold. This and the idea of do they liquidate or beome a pure licensing company are the main issues that remain.

Enjoy Mr. McFadden's comments:

On April 27, 2012 the Statutory Committee of Equity Security Holders of Trident Microsystems, Inc. (TMI), through it Conflicts Counsel, Quinn, Emanuel, Urquhart and Sullivan, filed a Rule 2004 Examination Motion (the “Rule 2004 Motion”), [Dkt. No. 524] seeking relief of the Court to take discovery and investigate the conduct of NXP. Describing the TMI bankruptcy as the “Quintessential” case for discovery under Rule 2004, the Equity Committee is seeking Court permission to conduct an examination of NXP's conduct with respect to what they describe as “four primary areas of discovery: (i) Cash Dissipation; (ii) Pre-petition Marketing Process; (iii) Post-petition Sale Process; and (iv) Post-petition Transfers.”



Further the Committee opines that “If pertinent facts are uncovered, they could give rise to claims and causes of action valuable to the Debtors' estates and, derivatively, the Equity Committee's constituency. Damages could potentially exist in the tens or even hundreds of millions of dollars as evidenced by, among other things, the significant amount of Cash Dissipation paid to NXP.” [See Rule 2004 Motion at ¶33].

...

On that point, the Committee offers that “Wearing all of these hats during the approximate two year-period immediately preceding the Petition Date, the Debtors paid NXP more than $400 million in consistent and systematic fashion - while spiraling towards bankruptcy, decimating the approximate $275 million in market capitalization that existed when they purchased the STB Business from NXP. In contrast, NXP experienced a dramatic turnaround, ultimately reporting outstanding financial results.” [See Rule 2004 Motion at ¶2].

continues on. Click the link to read the full comment.