CVI -- CVR Energy Inc.

[lincolnc]

Anyone know anything about this name?

 

Saw an article on it.

http://finance.yahoo.com/news/five-lows-daktronics-inc-ruby-225820290.html

 

Apparently Carl Icahn is the Chairman.

 

See:

http://investors.cvrenergy.com/phoenix.zhtml?c=203637&p=irol-govboard

 

Business is not in great shape

http://investors.cvrenergy.com/phoenix.zhtml?c=203637&p=irol-presentations

 

Massive 14% dividend

http://finance.yahoo.com/quote/CVI/key-statistics

 

But at some point Icahn takes this this private?

 

 

[awindenberger]

I wonder if they will continue the $.50 dividend one more quarter if CVRR isn't able to pay out a dividend once again.

 

UAN can probably do $.45-.50 cents this quarter, which would send about $18M to CVI. That seems like it would be enough to support a $.21/share quarterly dividend by itself. The question is whether or not CVRR and pay a dividend this Quarter.

[Simple Investor]

The bonds down the chain (CVRR) pay 10% ytm.  The mature in 2022. 

 

I'm doing some work now on who backs those bonds. 

[writser]

Icahn offers to exchange one share of CVRR for 0.6335 shares of CVI in order to raise his stake to up to 95%. Price action was absolutely ludicrous today: at market open the discount to the offer was huge (~13%) and over the next half hour it dropped to a more reasonable ~4.5%. I was lucky enough to notice the press release and set up a decent hedged position pre-market and shortly after the market opened. Average entry at an 11% discount , just closed it out at a ~4.5% discount. Both legs were profitable. Easiest money I made in a long time, crazy.

[writser]

Can anybody offer me a clue as to why the current CVRR / CVI spread is so large? Deal risk? Tax issues due to CVRR being a LP? Transaction is scheduled to close in July, no intermediate dividends as far as I can see but the spread is still ~5%. Please forgive me if this was a stupid question. No expert on the US tax system.