Replies to post #371097 on Mr Cooper Group Inc (COOP)

[WithCatz]

shanerbart --- two separate issues - WMIH securities vs. LTI Escrow

Can anyone give a short take on what they believe is still to happen with the escrow account & our new stock.

Holders of WMIH securities -- there is little news at this time as to the working plans. We have, what we feel, is a valuable company -- $75m in capital, $125m in a line of credit for acquisitions and mergers, and $5-17b (with a b) in NOLs that can be used to write-off against taxes over the next many years. However, there is a restriction for 2 years on a "change in ownership" -- and NOLs cannot simply be "bought" by a giant company. Many restrictions to the NOLs and an appropriate plan is nearly 100% certain to require IRS approval -- a "private letter" petition for a plan, and then executing a plan.

So for now, we remain in the dark. Necessarily, IMHO -- one can't announce a plan without knowing that the IRS may likely approve it. And developing such a plan, then documenting it to the IRS, and then getting the IRS "private letter ruling" all takes time.

Unlike many pink/penny stocks. This is likely not a short-term play. But a long-term one. For the NOLs basis and change in ownership -- look at 2 years or more.

So do the math. 200m outstanding shares -- at $75m, it's trading a little above the raw value -- but start factoring in the M/A potential, and the huge NOL potential -- then things may appear, to a given investor, as highly undervalued -- albeit, for a long-term play.

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COMPLETELY and totally separate -- and only for pre-exit holders. Eg, holding WMIH stock today doesn't entitle you to any escrow proceeds...

The 'escrow' is currently quite a way aways from seeing anything to the 'former' equity holders. All math that I have seen say it will require litigation against non-released third-parties -- Examples are D&O insurance policies, ratings agencies, etc. {While Goldman Sachs may be a source of deep monies, there may not be enough in litigation funds to go directly after them at this time}

For litigation, look at 3-6 years {The litigation trust will exist for 3 years, with an extension available for 3 more} -- this is of little importance to new investors. As the "litigation" escrow tracking securities cannot be sold. And are NOT TIED to current WMIH ownership in any way. It either will or won't benefit those who held and released at bankruptcy exit.

...Catz

[GO4AWILDRIDE]

shanner

The reason for the escrow of the old WAMU shares is for a possible payout from the LT if they win or compromise a legal settlement which brings in cash to the LT. Of course the higher claims would have to be paid off before any money would trickle down to equity.

In regards to the new WMIH shares: NOL's is the reason there will be value.

But it will not happen over night.

It could take 2 years for the BOD to be able to fully utilize the NOL's by selling off the company.

After the 2 year time frame the rules in regard to usage of NOL's become less restrictive.


Hope this answers your concerns.


GO4AWILDRIDE