tag:blogger.com,1999:blog-2080506270244832638.post8709185550912772286..comments2024-03-28T07:17:13.573-05:00Comments on Clark Street Value: LGL Group: Gabelli, Rights Offering, Acquisition ProposalMDChttp://www.blogger.com/profile/10679835609782815537noreply@blogger.comBlogger30125tag:blogger.com,1999:blog-2080506270244832638.post-85852078581699805952020-11-04T08:30:31.081-06:002020-11-04T08:30:31.081-06:00Interesting timing on your comment, ha, yeah I'...Interesting timing on your comment, ha, yeah I've been digging back into LGL, I think it is pretty attractive here and the warrant dividend is a strange but telling transaction that the Gabelli's want more of LGL. Also interesting that they've stuck a piece of a SPAC sponsor inside of LGL, any deal completed could be a material event for LGL.MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-71591566229505846172020-11-03T16:43:12.169-06:002020-11-03T16:43:12.169-06:00Any news on this one? I was reviewing my portfoli...Any news on this one? I was reviewing my portfolio and realized I still had a small position.Ted Grahamhttps://www.blogger.com/profile/06477707495675681426noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-5286919514830558512017-11-16T13:26:15.761-06:002017-11-16T13:26:15.761-06:00NOLs offset gain on sale -- exactly, that's a ...NOLs offset gain on sale -- exactly, that's a great point. Even if they forfeit the remaining NOLs, stock's still trading below cash. There is the small matter, though, of what Gabelli's son does with all that capital, given his history (link below) and the fact that LGL's liquid investments are currently placed with mutual funds he controls. http://www.businessinsider.com/marc-gabelli-market-timing-lawsuit-reinstated-2011-8<br /><br />Thoughts? Do those red flags warrant this pro-forma "trapped cash" discount? Ben's Jaminhttps://www.blogger.com/profile/01036316291484037538noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-48398779698442567432017-11-15T08:41:39.998-06:002017-11-15T08:41:39.998-06:00I'm not sure, sounds like they're structur...I'm not sure, sounds like they're structuring the deal to keep the NOLs, any taxable gain would likely be offset by them.MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-66095391930521928972017-11-15T08:24:41.702-06:002017-11-15T08:24:41.702-06:00Is there a chance that sale would still trigger so...Is there a chance that sale would still trigger some amount of taxes? Any idea what tax basis could be?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-22961564861655554392017-11-15T08:18:40.443-06:002017-11-15T08:18:40.443-06:00Final results from the rights offering: they sold ...Final results from the rights offering: they sold 1,698,983 shares for $9.4MM, since they sold less than excepted, the dilution is less than expected, by my math if the company takes the $14MM offer (assuming no taxes) they'd have $6.72/share in cash, ~$5.50 is really a silly price for it to be trading at now.MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-55048177919694910662017-11-14T09:28:10.749-06:002017-11-14T09:28:10.749-06:00Sort of. They're worthless if you don't ex...Sort of. They're worthless if you don't exercise them, so now that we're past the exercise date, they're worthless if that makes sense. The rights themselves don't have any value, but those who owned them should have exercised for the right to purchase the stock at $5.50 for a stock that's now trading at $5.54, a tiny discount. Still strange to me to see the stock trade down here, but I already own a full position in it.MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-58419680929084029962017-11-10T15:19:19.214-06:002017-11-10T15:19:19.214-06:00Rights -- selloff might be due to exercise expiry ...Rights -- selloff might be due to exercise expiry (broker notification period etc). Ben's Jaminhttps://www.blogger.com/profile/01036316291484037538noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-69088974063973287092017-11-10T15:17:03.073-06:002017-11-10T15:17:03.073-06:00Yes, I think that's accurate, plus whatever va...Yes, I think that's accurate, plus whatever value one supposes the NOLs have. There might be some capital gains tax incorporated by the markets. But I think the spread is mainly there given the unsolicited + conditional nature of offer, relative to more uncertainty about going-concern value of the operating assets if the sale doesn't go through. On the other hand, if anyone has powers of analysis that materially derisk those concerns, then it's an inefficient price. Ben's Jaminhttps://www.blogger.com/profile/01036316291484037538noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-69669360597031397972017-11-10T14:53:07.614-06:002017-11-10T14:53:07.614-06:00the only thing i can think of is it was misread as...the only thing i can think of is it was misread as $14mm offer, including cash on balance sheet.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-10888315032763428552017-11-10T14:34:23.444-06:002017-11-10T14:34:23.444-06:00It's about fairly valued then, at least with t...It's about fairly valued then, at least with the stock at $5.60, which seems very strange to me, can't come up with a reason why the shares would sell off given the news.MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-17168311389433047012017-11-10T14:30:33.297-06:002017-11-10T14:30:33.297-06:00I don't know if its relevant here, hard to kno...I don't know if its relevant here, hard to know if its the same party? Sounded like back then it was only for pieces of the business.MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-72299445552983069292017-11-10T12:37:54.346-06:002017-11-10T12:37:54.346-06:00anyone look at the rights? trading at 1canyone look at the rights? trading at 1cAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-59536380224410814942017-11-09T13:37:38.085-06:002017-11-09T13:37:38.085-06:00Interesting to see the spread blow out here. Do we...Interesting to see the spread blow out here. Do we know what the deal terms were from 2014?Forresthttps://www.blogger.com/profile/09102260605312281771noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-3742457990588495692017-11-09T10:07:06.058-06:002017-11-09T10:07:06.058-06:00plus the NOL is still intact...plus the NOL is still intact...Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-60872418404428564712017-11-09T10:00:59.954-06:002017-11-09T10:00:59.954-06:00I am coming to the same value, weird that trades a...I am coming to the same value, weird that trades are happening lower?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-84584274555393479042017-11-09T08:44:15.558-06:002017-11-09T08:44:15.558-06:00https://seekingalpha.com/pr/16997466-lgl-provides-...https://seekingalpha.com/pr/16997466-lgl-provides-update-non-binding-acquisition-proposal-lgl-reminds-shareholders-rights-offering<br /><br />Investment group's offer is $14MM for the operating assets. Plus $6MM in cash, the rights offering is still on which will raise $11MM in cash, new share count will be 4,682,063 shares. If the deal is consummated, I have the pro-forma company with $6.40/share in cash on the balance sheet?MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-26824640382485980412017-11-02T11:04:38.696-05:002017-11-02T11:04:38.696-05:00I think you're right on both your points, NOL ...I think you're right on both your points, NOL rules used to be a lot looser but the IRS cramped down on that a while back. And yes, be careful about buying significant amounts of the rights on the secondary market to oversubscribe because there's a chance the rights offering gets cancelled, but hopefully that would be parallel with a buyout offer dulling same pain. I still just own the shares at this point.MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-22515835609776045442017-11-02T11:01:54.542-05:002017-11-02T11:01:54.542-05:00I think you sum it up pretty well, there's a p...I think you sum it up pretty well, there's a potential short term profit opportunity (that's what I view as the upside) and if not, a longer term opportunity to invest alongside Gabelli.MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-75095615704623104212017-10-30T20:18:30.071-05:002017-10-30T20:18:30.071-05:00Raising more capital to acquire a larger earnings ...Raising more capital to acquire a larger earnings stream that can more quickly harvest the NOLs makes sense, particularly since those NOLs might be worth less farther out in time if Congress passes the tax cuts. I guess there's also no way Gabelli could "sell" those NOLs to a buyer without triggering limitations? <br />The oversubscription play makes sense (particularly to smaller holders, since larger shareholders are limited in the extent to which they can participate in oversubscription), but factoring in the likelihood of this particularly rights offer not being cancelled into an expected value seems a tough exercise. Thoughts? Ben's Jaminhttps://www.blogger.com/profile/01036316291484037538noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-71618101405055449142017-10-30T15:16:40.465-05:002017-10-30T15:16:40.465-05:00Thanks for the idea. IMO the stock is fairly pric...Thanks for the idea. IMO the stock is fairly priced @ $6. Owners earning multiple seems in line with the stock price. I haven't studied the company in detail but based on the previous years earnings the company is trading over book. My guess is that it is b/c of Gabelli? The easy money would be if a take over occurs (but what would happen to the NOLs?) or if the business continues to report improving results (personally, I have no expertise in the industry). Hope to hear your thoughts...Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-63891848105028674482017-10-28T22:05:00.114-05:002017-10-28T22:05:00.114-05:00I believe the oversubscription rights are attached...I believe the oversubscription rights are attached to the rights themselves, you should be able to buy them on the secondary market and oversubscribe, the record date shouldn't matter here. Thanks.MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-72248383771835036542017-10-28T16:25:22.023-05:002017-10-28T16:25:22.023-05:00MDC,
Is it your understanding that if one buys say...MDC,<br />Is it your understanding that if one buys say 12 shares of the LGL.r, one would be able to execise the rights for 3 shares of common at $5.50 each and still be able to oversubscribe for more shares of the common. Or, instead, would you be able to exercise the rights for shares but NOT be able to participate in the over-subscription because one was not a record holder on 9-5-2017. In other words, in transferring the rights from buyer to seller, do the rights also transfer the ability to oversubscibe?<br />Thanks, Peter<br />Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-18291821595445054202017-10-27T11:45:14.364-05:002017-10-27T11:45:14.364-05:00That's good point too. The rights offering ca...That's good point too. The rights offering can be cancelled and rights purchased on the secondary market would be worthless (I think), but I don't think they're necessarily mutually exclusive events. The investor group could buy the operating business for cash from LGL, LGL could pair that cash alongside the funds raised in the rights offering and go purchase another business? There are a few potential paths here. Thanks, good comment.MDChttps://www.blogger.com/profile/10679835609782815537noreply@blogger.comtag:blogger.com,1999:blog-2080506270244832638.post-69613146179701732632017-10-27T11:33:06.762-05:002017-10-27T11:33:06.762-05:00Hmm so what happens to the currently tradable righ...Hmm so what happens to the currently tradable rights if the rights offer is cancelled and they pursue the merger instead? Or are those 2 events not mutually exclusive..Ben's Jaminhttps://www.blogger.com/profile/01036316291484037538noreply@blogger.com