Replies to post #92773 on Lehman Brothers Financial SA (LEHNQ)

[toogoodfella]

Preferred will go back to Par
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We can only speculate of course because unlike Cts with guarantee of “interest” payments, Preferred will get “dividend” only if company makes profit.
On the other hand, they have to show to public that they are paying dividend to attract more buyers to raise more capital in selling more Preferred from their stockpile.

[sidedraft]

What price do you use as PAR value?

.... do you think the Preferred will go back to Par value ....

[The Godfather]

If LEH starts paying just the dividends on the CTs starting next quarter, we would be at face value overnight. Any CTs that have been held by the estate can now be sold back to the public at Face value and a lot of capital raised. With that capital infusion and the NOLs to take care of, LEH can truly return from the grave and I am betting thats exactly what Barclays is planning for this. Maybe a conspiracy on my part but stranger things have happened lately and so, anything is possible.

[toogoodfella]

RE:
assuming we dont get diluted after reemergence.
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Dilution is only possible in common shares.

Preferred is just a piece of paper backed with common shares with a total value equal to face value.

ie: a 25 preferred is ratable with 25 common shares at one dollar each.

Or 50 common shares at fifty cents = 25 dollar preferred