Replies to post #6380 on Trenwick Group, Ltd.(fka TWKGQ)

[lifegear]

do they expect us to forget the MBO? lol

[lifegear]

2008 Change in Section 382: Use of NOLs....

How it affects mergers -- particularly for Wells Fargo/Wachovia merger, it could shelter $74 billion in profits from taxation

This change applies to all mergers with companies having NOLs which makes TWKGQ a great candidate for a reverse merger with a profitable company imho. We have NOLs valued at over $4 per share. It's the same reason why STBP peaked at .51 from .0001 and I can't find anything that prevents TWKGQ from at least doing the same thing in the long run should they announce something to make use of this contingent asset.


"The amount of lost tax revenue would depend on the future profitability of Wells Fargo and the losses on Wachovia's loans, but based on Wells Fargo's financial disclosures, it could shelter $74 billion in profits from taxation.

The Treasury Department said the change in tax laws was not intended to benefit any particular company and had been under consideration for weeks. The change was announced with a handful of other measures designed to buttress the banking industry after the House of Representatives initially rejected the Treasury's bailout plan."

http://www.washingtonpost.com/wp-dyn/content/article/2008/10/03/AR2008100301042.html

http://swampland.blogs.time.com/2008/11/15/the-silent-change-to-section-382/

[lifegear]

Effect of Change in NOLs for 2008...

The change in Section 382 allows no limit per year on how much profit they could shelter using NOLs - Wells Fargo will be able to not pay $25B in taxes using the $74B in losses acquired thru merger.

"Losses can be used to shelter income for as long as 20 years. So under the old law, Wells Fargo would have received a maximum benefit of $20 billion in tax protection, and only up to $1 billion each year. Now, the company could shelter from taxation its next $74 billion in profits. "

[lifegear]

do you have any idea where that $87M intercompany debt came from? there was no mention of it back in LSRAF Dec07 8K, all that was mentioned was the $67M that was owed to TGL and TAC

does the $87M include the preferential liquidation of $75M or $25 per share for LSRAF plus some unpaid dividends?

[lifegear]

2. Current status of TGL’s liquidation...

Aren't we supposed to know the identities of the parties who entered into a binding agreement with TGL on Feb2008 and the details of the "Transaction" which was completed on June 4, 2008? They were talking about a buyout of the Lloyd's operations back in Dec07 (LSRAF 8K - As part of the RITC transaction, Canopius Group made a series of linked offers
to a number of entities with an interest in the Oaks and LSUK.)


"The JLs have made substantial progress in the affairs of TGL and its subsidiaries. In particular, on 27 February 2008 the JLs entered into a binding agreement with a number of parties in respect of the sale of TGL’s economic interests as well as the determination of certain debt obligations to a number of parties (the “Transaction”). The JLs have also completed a number of smaller non-material transactions relating to the Company.



The completion of the Transaction was instrumental in allowing TGL and its remaining subsidiaries to finalise their respective liquidations given that the Transaction resulted in the cancellation of certain guarantees that TGL, and other subsidiaries of TGL, had provided to a syndicate of lending banks in respect of Letters of Credit (“LOCs”) supporting TGL’s former Lloyd’s of London underwriting activities. The existence of the guarantee had meant that TGL had a significant external contingent creditor (i.e. a debt owing to a party outside of the TGL group of companies).


Following the completion of the Transaction, on June 4, 2008 the JLs of the Company advertised the notice of the proposed bar date for claims and the Company’s creditors where given a deadline of July 3, 2008 in which to submit any outstanding claims against TGL. Submitted claims in the Company’s liquidation totalled approximately US$127 million and US$87 million of these claims related to an inter-company loan note in favour of TGL’s subsidiary LaSalle Re Ltd (see section 3.2 below). The balance of the claims submitted to TGL related almost exclusively to a subordinated claim in respect of contingent capital."

http://knobias.10kwizard.com/filing.php?param=&ipage=5990251&DSEQ=1&SEQ=&SQDESC=SECTION_BODY&exp=

[lifegear]

MBO Confidentiality Clause on Announcements....

Reason why they can't disclose the "Transaction" details...

They are bound by a confidentiality clause regarding announcements. This is all related to the Long Term Management Buyout-MBO back in 2003 and also referred to non-disclosure of even THE STOCK EXCHANGE...hmmmm REINSTATING THE REALTIME QUOTES ON 10/27/08 WASN'T USELESS AFTER ALL IMHO

"Announcements

12.7 The parties to this Agreement shall and shall procure that their
affiliates shall keep strictly confidential details of the transaction
contemplated by this Agreement or any ancillary matter and no announcement
concerning the same shall be made either before or after Completion by
either party without the prior written approval of the other except as may
be required to implement this Agreement, any acts or transactions
contemplated by it or in documents and matters referred to in or by
statute or by any securities exchange or regulatory or governmental body
to which any party is subject or submits wherever situated, including
(without limitation) THE STOCK EXCHANGE, the Inland Revenue, The Panel on
Take-overs and MERGERS, the Bermuda Monetary Authority, the joint
provisional liquidators of Trenwick Group Limited and of LaSalle Holdings
Limited, any relevant bankruptcy court and the creditors of any member of
the Trenwick Group, whether or not the requirement has the force of law.

SEE 12.7 http://knobias.10kwizard.com/filing.php?param=&ipage=2491584&DSEQ=6&SEQ=&SQDESC=SECTION_EXHIBIT&exp=