WLRHU - WL Ross Holding Corp (Wilbur Ross SPAC)

[Guest JoelS]

This is a new special purpose acquisition company set up by Wilbur Ross. The co. began trading on the market in early June. The actual stock is not on its own, yet. The symbol, WLRHU, represents a unit of common stock and a warrant to buy half a share at a price of $5.75 per half share.

 

"WL Ross Holding Corp is is a blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses."

 

Just throwing it out there as Wilbur Ross is a terrific investor.. See article below for some background on this vehicle.

 

http://qz.com/208896/billionaire-wilbur-ross-joins-the-market-move-back-to-spacs/#/h/68526,1,3/

[dcollon]

WL Ross Holding Corp. Common Stock And Warrants To Commence Trading Separately On August 5, 2014

Monday, August 04, 2014 10:00:00 PM (GMT)

 

 

NEW YORK, Aug. 4, 2014 /PRNewswire/ -- WL Ross Holding Corp. (the "Company") (Nasdaq: WLRHU) today announced that the holders of the Company's units may elect to separately trade the common stock and warrants underlying the units commencing August 5, 2014. Those units not separated will continue to trade on the Nasdaq Capital Market under the symbol "WLRHU" and the common stock and the warrants are expected to trade under the symbols "WLRH" and "WLRHW", respectively.

 

The Company is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock repurchase, stock purchase, reorganization or similar business combination with one or more businesses.

 

[peter1234]

Any idea as to what as to what he is looking at?

 

Thought he was saying he was selling 6x of as much as buying.

 

Recently moved into Greek Financials.

 

More in European Financials or just a stash of cash in case something pops up or market corrects?

 

;)

[siddharth18]

He's partnering with Awilco guys (Arne Wilhelmsen of Norway) to buy VLCCs: https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0CB8QFjAA&url=http%3A%2F%2Fwww.tradewindsnews.com%2Fweekly%2F340804%2FWilhelmsen-links-up-with-Ross-in-return-to-tankers&ei=RH_gU4OjO4rjsASH9oKICA&usg=AFQjCNHXlyJHcqeH_GT1-zYuB8uWUV4FuA&bvm=bv.72197243,d.cWc

 

 

(or see attached file)

 

 

Wilhelmsen_links_up_with_Ross_in_return_to_tankers_-Tradewindsnews.pdf

[yadayada]

yeah see the TOPS thread on a possible opportunnity there.

[peter1234]

Thanks for the info.

:)

[Guest JoelS]

Brooklyn Investor: http://brooklyninvestor.blogspot.co.nz/2014/08/wl-ross-holding-corp-wlrh.html

 

[Evolveus]

http://www.outlookbusiness.com/article_v3.aspx?artid=283879#.U_jNgj_wdm0.twitter

 

Recent interview with Ross and touches a little bit on where he sees opportunity.

[peter1234]

http://www.outlookbusiness.com/article_v3.aspx?artid=283879#.U_jNgj_wdm0.twitter

 

Recent interview with Ross and touches a little bit on where he sees opportunity.

 

Thanks, nice article.

 

Looks like it is from Feb 2013?

;)

[Evolveus]

Shoot - you're right Peter - it is from feb 2013. My bad! I think it's a still a good piece but yes, slightly dated.

[peter1234]

Shoot - you're right Peter - it is from feb 2013. My bad! I think it's a still a good piece but yes, slightly dated.

 

No problem, always great to read about Wilbur Ross. Just wanted to make sure I am looking at the right piece.

;)

[ni-co]

On October 28, 2014, effective immediately, the Board appointed Mr. Miller to serve as a member of its Audit Committee and the Chairman of its Compensation Committee, having previously determined that he satisfies all applicable requirements to serve on such committees, including without limitation the applicable requirements of the NASDAQ Capital Market and the Securities Exchange Act of 1934, as amended. Upon Mr. Miller’s appointment to the Audit Committee, Mr. Wilbur L. Ross, Jr., resigned from the Audit Committee but will continue to serve in his capacity as the Company’s Chairman and Chief Executive Officer.

 

https://www.sec.gov/Archives/edgar/data/1604416/000114420414063652/v392449_8ka.htm

 

Is there something beginning to move?

[jrallen81]

Checking to see if I'm right about this - with SPACs, you are diluted 20% by the founders' shares, correct?

[OracleofCarolina]

That's my understanding...theBrooklyn Investor had a write up on this SPAC a couple of months ago

[undervalued]

I see Pabrai initiated a small position in this.

[usdtor05]

you get diluted if a deal gets done but these days there are a number of protections on these so you can (eventually) turn in your shares for $10ish. assuming if ross does on tho it will be well received.

 

[jrallen81]

I guess its like 2 and 2 0 but without the 2!

[gr33ngi4nt]

WLRH trading sub $10 again. Warrants and commons have declined significantly over last few days. I can't seem to find any reason for the dislocation...

[usdtor05]

It looks like somebody large needed to get out based on the massive volume that popped up out of nowhere. I couldn't find anything that Wilbur said on CNBC the other day that made me think he wasn't going to get a deal done.

[Guest notorious546]

sub 10 looks good.

[muscleman]

It looks like somebody large needed to get out based on the massive volume that popped up out of nowhere. I couldn't find anything that Wilbur said on CNBC the other day that made me think he wasn't going to get a deal done.

 

Agreed! Today the WLRH has bid 9.98 with size 7 and ask 9.99 with size 42. I  think some equity fund is probably liquidating the WLRH positions because they are getting impatient.

Are you guys buying WLRH or WLRHU?

 

For WLRH, are you sure that you will get back $10 instead of something like $9.6 in Jun 2016, if no deals happen? As I understand, WLRHU was IPO'ed at the price of $10. So if no deals happen, will there by any kind of management fees?

 

Who kinds WLRHW could be the best bet?

 

[TwoCitiesCapital]

It looks like somebody large needed to get out based on the massive volume that popped up out of nowhere. I couldn't find anything that Wilbur said on CNBC the other day that made me think he wasn't going to get a deal done.

 

Agreed! Today the WLRH has bid 9.98 with size 7 and ask 9.99 with size 42. I  think some equity fund is probably liquidating the WLRH positions because they are getting impatient.

Are you guys buying WLRH or WLRHU?

 

For WLRH, are you sure that you will get back $10 instead of something like $9.6 in Jun 2016, if no deals happen? As I understand, WLRHU was IPO'ed at the price of $10. So if no deals happen, will there by any kind of management fees?

 

Who kinds WLRHW could be the best bet?

 

At prices significantly below $10 for WLRH I would begin seriously considering WLRHU to get access to the warrants. The discount to liquidation would basically compensate me for loss I'd take on the warrants if no deal was done. Given prices right around $10, I'm sticking with WLRH as a cash equivalent with upside optionality and no downside. I really like these idiosyncratic opportunities with the market being where it is and will likely build the position as I move out of other positions of mine. He only has until December to announce something and I know that shipping and Greek banks have fallen quite a bit since his original investments in the sector so I'm sure there are deals to be found even in just those two sectors.

[lschmidt]

It looks like somebody large needed to get out based on the massive volume that popped up out of nowhere. I couldn't find anything that Wilbur said on CNBC the other day that made me think he wasn't going to get a deal done.

 

Agreed! Today the WLRH has bid 9.98 with size 7 and ask 9.99 with size 42. I  think some equity fund is probably liquidating the WLRH positions because they are getting impatient.

Are you guys buying WLRH or WLRHU?

 

For WLRH, are you sure that you will get back $10 instead of something like $9.6 in Jun 2016, if no deals happen? As I understand, WLRHU was IPO'ed at the price of $10. So if no deals happen, will there by any kind of management fees?

 

Who kinds WLRHW could be the best bet?

 

At prices significantly below $10 for WLRH I would begin seriously considering WLRHU to get access to the warrants. The discount to liquidation would basically compensate me for loss I'd take on the warrants if no deal was done. Given prices right around $10, I'm sticking with WLRH as a cash equivalent with upside optionality and no downside. I really like these idiosyncratic opportunities with the market being where it is and will likely build the position as I move out of other positions of mine. He only has until December to announce something and I know that shipping and Greek banks have fallen quite a bit since his original investments in the sector so I'm sure there are deals to be found even in just those two sectors.

I have also been seriously considering this investment essentially as cash + a free option.

 

However, is it completely reasonable for us to consider it as a cash equivalent? If Ross announces a distressed investment in the next few months, will the market view it favorably or unfavorably (it would be, after all, in an unfavored industry such as the energy sector or a European lender)? The price could go down. Further, the investment may or may not be successful, and the NAV could decrease. The relative merits of cash vs WLRH are not completely clear-cut. What do you think?

[gr33ngi4nt]

It looks like somebody large needed to get out based on the massive volume that popped up out of nowhere. I couldn't find anything that Wilbur said on CNBC the other day that made me think he wasn't going to get a deal done.

 

Agreed! Today the WLRH has bid 9.98 with size 7 and ask 9.99 with size 42. I  think some equity fund is probably liquidating the WLRH positions because they are getting impatient.

Are you guys buying WLRH or WLRHU?

 

For WLRH, are you sure that you will get back $10 instead of something like $9.6 in Jun 2016, if no deals happen? As I understand, WLRHU was IPO'ed at the price of $10. So if no deals happen, will there by any kind of management fees?

 

Who kinds WLRHW could be the best bet?

 

At prices significantly below $10 for WLRH I would begin seriously considering WLRHU to get access to the warrants. The discount to liquidation would basically compensate me for loss I'd take on the warrants if no deal was done. Given prices right around $10, I'm sticking with WLRH as a cash equivalent with upside optionality and no downside. I really like these idiosyncratic opportunities with the market being where it is and will likely build the position as I move out of other positions of mine. He only has until December to announce something and I know that shipping and Greek banks have fallen quite a bit since his original investments in the sector so I'm sure there are deals to be found even in just those two sectors.

I have also been seriously considering this investment essentially as cash + a free option.

 

However, is it completely reasonable for us to consider it as a cash equivalent? If Ross announces a distressed investment in the next few months, will the market view it favorably or unfavorably (it would be, after all, in an unfavored industry such as the energy sector or a European lender)? The price could go down. Further, the investment may or may not be successful, and the NAV could decrease. The relative merits of cash vs WLRH are not completely clear-cut. What do you think?

 

+1. I don't know enough about investing in SPV to know the typical hit rate. While I think WR is a great investor, I don't view this to be a risk-less investment and would position size accordingly. That said, I certainly think there is some optionality sub-$10.

[TwoCitiesCapital]

It looks like somebody large needed to get out based on the massive volume that popped up out of nowhere. I couldn't find anything that Wilbur said on CNBC the other day that made me think he wasn't going to get a deal done.

 

Agreed! Today the WLRH has bid 9.98 with size 7 and ask 9.99 with size 42. I  think some equity fund is probably liquidating the WLRH positions because they are getting impatient.

Are you guys buying WLRH or WLRHU?

 

For WLRH, are you sure that you will get back $10 instead of something like $9.6 in Jun 2016, if no deals happen? As I understand, WLRHU was IPO'ed at the price of $10. So if no deals happen, will there by any kind of management fees?

 

Who kinds WLRHW could be the best bet?

 

At prices significantly below $10 for WLRH I would begin seriously considering WLRHU to get access to the warrants. The discount to liquidation would basically compensate me for loss I'd take on the warrants if no deal was done. Given prices right around $10, I'm sticking with WLRH as a cash equivalent with upside optionality and no downside. I really like these idiosyncratic opportunities with the market being where it is and will likely build the position as I move out of other positions of mine. He only has until December to announce something and I know that shipping and Greek banks have fallen quite a bit since his original investments in the sector so I'm sure there are deals to be found even in just those two sectors.

I have also been seriously considering this investment essentially as cash + a free option.

 

However, is it completely reasonable for us to consider it as a cash equivalent? If Ross announces a distressed investment in the next few months, will the market view it favorably or unfavorably (it would be, after all, in an unfavored industry such as the energy sector or a European lender)? The price could go down. Further, the investment may or may not be successful, and the NAV could decrease. The relative merits of cash vs WLRH are not completely clear-cut. What do you think?

 

+1. I don't know enough about investing in SPV to know the typical hit rate. While I think WR is a great investor, I don't view this to be a risk-less investment and would position size accordingly. That said, I certainly think there is some optionality sub-$10.

 

Sure, there is no guarantee in any investment product. You could put 100% of your money in a stable value fund and the commercial paper market could explode and there is a possibility you lose a significant piece of your investment. People still refer to Stable Value funds as being a cash equivalent due to the remoteness of this risk and the magnitude of the likely loss being low. I think it's reasonable to consider WLRH as a cash equivalent for some of your cash holdings up until the point that an acquisition is announced.

 

Let us consider the 4 alternatives for WLRH.

 

1) WLRH bids for no company and the money returned at a known, calculable amount of around $10/share.

2) WLRH bids for a company that is publicly traded and unpopular. WLRH is unlikely to fall simply due to the arbitrage opportunity (short underlying and buy WLRH). It will continue to trade at NAV or at a premium to NAV.

3) WLRH bids for a company that is privately owned/publicly traded and popular. WLRH is likely to trade at a slight premium to NAV simply for getting access to a skilled manager and because a popular company wouldn't engender such a discount.

4) WLRH bids for a company that is privately owned and unpopular. This scenario could end up in a stock at a discount to NAV; however, you'd have to be banking on investors overlooking the benefits of having WLR as a manager AND the idiosyncratic returns one could expect from owning an individual entity that is no longer public outside of your vehicle AND hate it so much to warrant a discount to NAV.

 

Sure there is the possibility that it trades below your cost - but the likelihood is low and the magnitude of loss is likely small.