Olmsted

Actually sold this yesterday. (or is it this morning?) Something. Australia time. Still cheap

CIMIC offer to buy shares it doesn't own for 1.07. http://sedgman.com/files/documents/CIM%20FINAL%20UNCONDITIONAL%20OFFER%20FOR%20SEDGMAN%20BY%20CIMIC.pdf Board says don't do anything until we evaluate. http://sedgman.com/files/documents/SDM%20Directors%20response%20to%20CIMIC%20offer.pdf Offer is unconditional, which means CIMIC can go out in the market and buy shares right now for 1.07 - hence no arb spread in the stock right now. I put this at ~5.7x FCF bid. What's nice is they can self-fund most of it with the cash on the B/S Holding for now to see if it gets raised or someone else comes along. But that's subject to change at any time because it's nice to book a win these days (too few and far between) Great idea and analysis, to the others on this board

Surprised nobody has brought up the ignominious history of the company chronicled in this documentary: http://en.wikipedia.org/wiki/Office_Space (Sorry for the non-value-add post. I try to keep them minimal)

Ah, I see. Thank you for the context - much obliged.

Yes this is something I too am working my head around. I see the negative book value, I see the 600m+ accumulated depreciation, and we have 800m+ of medical equipment at cost. I presume that their depreciation schedule is aggressive and does not accurately reflect the need to replace machines. This seems to be the case - I see depreciation consistently running higher than "new equipment purchases." My only concern here though is that as new equipment purchases are put off - there is a "wave" of Capex requirement coming at some point in the future, which should correctly be thought of as a liability. Thoughts?

MMA has re-entered the energy project finance business: http://mmacapitalmanagement.investorroom.com/2014-12-15-MMA-Capital-Forms-MMA-Energy-Capital http://www.mmaenergycapital.com/ The managing director, Bob Hopper, has a pretty good pedigree in the space: Was a MuniMae employee in MMA Renewable Ventures. Left, founded ClearPeak advisors renewable energy project development, biz development, buy and sell side advisory services and market consulting [*]ClearPeak advisors was sold to Enfinity [*]Enfinity was bought by SunEdison [*]Left SunEdison for MMA Energy Capital

Q3 Earnings out Highlights: -Equity per share up to $11.06 (from $9.69 in Q2) -$2.75M operating income - not including any one-time events (and with this company, there are always lots of those) -Cost base down nicely while we wait for cash to be put to work -Repurchased 240K shares in Q3. Buyback in place up to $11.01. -Path forward has not changed: "The task ahead of us remains clear, we need to wisely reinvest the cash we have generated from asset sales in ways that allow us to take advantage of our net operating losses going forward. We see both investment and business opportunities which we think will allow us to make prudent use of our cash and help us build and expand our existing business lines" http://mmacapitalmanagement.investorroom.com/2014-11-10-MMA-Capital-Management-Announces-Third-Quarter-2014-Financial-Results-Business-Update-and-Investor-Conference-Call Other updates -Executed 5:1 reverse split -Listed as MMAC on NASDAQ -Did a clever transaction to sell its low-income housing tax credit business, creating ~$15.8M NAV from something held at $0 (although accounting rules defer this gain), while retaining an option to buy it back later: http://mmacapitalmanagement.investorroom.com/2014-10-14-MMA-Capital-Announces-a-Series-of-Transactions-Related-to-its-Tax-Credit-Equity-Business

Olmsted: Looks like you enjoyed a nice bump in MMAB. I haven't looked into it. I'm just posting here to see if anyone is still following GPT. Certainly GPT is a much more "boring" business now, but I really like the new management. I sold a bunch after the big run-up from $2 to $4+. Then I was listening to the quarterly calls and following what they were doing really liked what I saw. So I built back a position and intend to keep it for the long term. I think these guys really know what management honesty/transparency means. They're highly incentivized and they seem to have a pretty solid focus on shareholder value. I like that they're buying properties not just based on current cap rate but also on long-term value (particularly their "covered land plays"). Hmmm, apparently I have a crush on management. The biggest con is the obvious substantial interest rate risk for the whole industry. But I trust that these guys are building some very durable cash flows. Thanks. I really like GPT management too and think the future is bright, but it's just not my game any more.

US investors may have noticed that they are "unable" to access the full press release of the rights offering. (I've encountered this before, has something to do with compliance with US securities laws and soliciting an offering.) This prompted me to check whether US investors can participate in the offering at all. Response from IR:

Yes I am glad it is working out as well. I still see this as a balance sheet-driven story, as the company's future business model is still yet to be unveiled. The earnings picture is cloudy now from all the one-time events.

For those still watching, a belated update: Equity/share at $2.02 (They sold the REO that previously contributed to the $2 estimate, now it is official) Buyback authorized up to $1.92 They put some cash to work buying back bonds they used to own, layering some TRS to get good mid-teen returns. Now we're just waiting to see what the next phase looks like. Latest transcript: http://munimae.investorroom.com/download/MMAB_051914.pdf

I am happy to eat something not regulated by the FDA if I can look the producer/distributor/etc. (every step of the value chain) in the eyes, develop trust, and know who is accountable if there is a quality issue. Obviously aside from farmers' markets/locavore movements that is not possible. I think this is the point - if you have good information and accountability, no regulation is ever needed, ever. In many cases it is difficult to obtain good information and difficult to directly enact accountability as a consumer. Not everyone is peaceful and honest, rkbabang. In these cases there can be market failures, and regulation is one way to attempt to develop trust in the face of anonymity/disaggregated responsibility. Now, a very fair question is whether the cure is worse than the disease. I think that in the US the answer is often, "yes."

-Imperfect information -Incomplete and/or poorly-defined property rights (externalities, free-riding) -Principle-agent issues -Moral hazard I think most market failures boil down to one of these phenomena at some level.

Hadn't thought about the second option. Good point. That would be a somewhat humorous full circle for those rigs.

It might also give us some publicity, and give the market a comp to help investors price Awilco. I'd say positive.