cemadh Posted January 12, 2013 Share Posted January 12, 2013 The 30.x% Peter Kellogg stake (up from 20.xx) and "rumors" of a road show organized/set up by the newly appointed IR firm are probably causing the price spike. Some other positives (in my opinion): Stated book value is $12.79. Michael Smith (MS) wrote up the book value (from $8.7x) after the Compton deal. Whether you believe the new book value or not, most people agree that Compton was a good deal for MIL shareholders and a bad deal for Compton shareholders. MS wants/plans to start a fund connected to the Compton gas production that his "friends in Asia" can invest in and get some cash out of Compton. I believe that there is tremendous upside to Compton, especially if, as another poster said, NG prices go up. NG is close to an all-time low, so that is more likely than not. Pea Ridge could also be very valuable depending on iron ore prices and how cost effectively they are able to deal with the water and extract the iron ore from there. Back of the envelope numbers for mineral value is about $5 billion. Take 10% of that as profit margin and split 50% with Alberici - you still get very good numbers for ROI. Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted January 12, 2013 Share Posted January 12, 2013 I've seen on the MIL website that Peter Kellogg has increased his stake to 30.9% of shares outstanding (http://www.mfcindustrial.com/SEC). In hindsight, he should have increased his position in MFC Financial right after it spun off (and a few years before it merged with Terra Nova). He missed a huge gain on MFC. Michael Smith plays a lot of games with shareholders though. KHD shareholders got shafted big-time in the rights offering. MFC Financial had very little transparency when it first spun off. 2- The iron ore royalty that MFC owns is running into some trouble. The Wabush mine is having problems... you can get more information from Cliffs earnings press releases and so forth. Overall I think that Smith's capital allocation skills are slightly above average and his ethics slightly below average. Yes MFC Financial went up several-fold but that is mostly because it was heavily oversold when it first spun off because nobody understood it (you needed to take your time and have read the related party transactions section carefully). Smith sat on a lot of cash earning low rates of return. The commodities trading business in MFC is a mediocre business. John Malone is a better allocator of capital and his ethics are superior. The same can be said of Brian Dalton of Altius Minerals if you want to play commodities/iron ore. Link to comment Share on other sites More sharing options...
Olmsted Posted January 12, 2013 Share Posted January 12, 2013 Congrats to all the MIL holders. I got out a little early. Yeah, me too, out around 9. I got turned off long ago by the shenanigans around the KHDHF spin that ended up screwing minority shareholders. Although Smith/Kellogg can wrangle some good deals, I lost trust in them to act in my interest. I am sure it will happen again. Decided I would bail as soon as the price presented a reasonable opportunity. Congrats to those still in, looks like you are in for a bit of a ride higher. Smith family stocks do nothing for ages, then when management decides to make something happen, they move. I think that process is happening right now. Link to comment Share on other sites More sharing options...
cemadh Posted January 12, 2013 Share Posted January 12, 2013 The MFC Industrial road show is planned for next week. NYC - 14th and 15th Boston - 16th Chicago - 17th This is according to the Cameron Associates (new IR firm) website. See http://www.cameronassoc.com/mfc-industrial-inc.html Link to comment Share on other sites More sharing options...
cemadh Posted January 18, 2013 Share Posted January 18, 2013 Options monster is reporting "unusually high" call buying in MIL July 12.5 strike. http://finance.yahoo.com/news/upside-position-targets-mfc-industrial-094749054.html From personal experience, it is very hard to predict movement in this stock. We could stay at these levels for 2 years or we could jump to $15 by the end of the year. I bought a ton of calls in 1Q2011. MIL was trading at $8.xx and the option premium was only 15 cents for Jan 2013 strike 7.15 calls. I though that this was a sure bet. Surely - the stock would rise more than 15 cents in two years especially since the company had all this cash and MS was supposed to be a great capital allocator! I could have been more wrong. I was underwater almost all the time and by pure luck, MIL surged up in Dec 2012 and January 2013 giving me an 89% gain on the calls. I have exercised them and I am content to wait.... Link to comment Share on other sites More sharing options...
Josh4580 Posted April 21, 2013 Share Posted April 21, 2013 MFC Industrial is back down to $8. Time to take another look. Link to comment Share on other sites More sharing options...
finetrader Posted April 22, 2013 Share Posted April 22, 2013 It îs on my watch list. Commodities are not doing well so is MIL. I sold puts at 7.50$ strike, so will wait to see where share price goes. Link to comment Share on other sites More sharing options...
rogermunibond Posted April 22, 2013 Share Posted April 22, 2013 They wrote down the Goa iron mine, after the govt shu it down. Real eff up. CLF has announced adjustment to Wabush volumes. On the plus side ng is helping the Compton asset sale. Link to comment Share on other sites More sharing options...
seeker Posted November 19, 2013 Share Posted November 19, 2013 Anybody still looking at this? Trading at about 2/3 BV and recently posted on VIC. Getting up to speed on the thesis now. Link to comment Share on other sites More sharing options...
bz1516 Posted November 20, 2013 Share Posted November 20, 2013 It must have been about 5 years ago I bought what looked like a sweet little deal in a little iron ore royalty company on a mine in Labrador. Had not even heard of Michael Smith or his commodity company at that time. I watched in amazement the byzantine moves that were made that took most of the potential out of my position. Not saying I didn't make any money, but it certainly wasn't worth what these guys put the investors through. Wound up talking with a guy in Vancouver who represented the company's and Smith's interests. Let's just say their disclosure changed each time I spoke with them. it was on a need to know basis. Link to comment Share on other sites More sharing options...
skanjete Posted November 27, 2013 Share Posted November 27, 2013 'NEW YORK, Nov. 27, 2013 /PRNewswire/ -- MFC Industrial Ltd. ("MFC" or the "Company") (NYSE: MIL) today responded to the press release of Peter Kellogg ("Kellogg") and IAT Reinsurance Company Ltd. ("IAT") that they have nominated persons to be elected as directors at the annual general meeting of the Company. MFC announces that, as a result of numerous, egregious and ongoing violations of Canadian and United States securities laws, it has commenced legal actions against Kellogg, IAT and their related entities (the "Kellogg Group") in the British Columbia Supreme Court (Vancouver Registry) and the United States District Court for the Southern District of New York seeking, among other things, orders prohibiting the Kellogg Group from voting its MFC shares or acquiring further MFC shares and requiring the Kellogg Group to dispose of MFC shares. Additionally, MFC has applied to a Canadian securities regulator to investigate the actions of the Kellogg Group and make appropriate orders.' How is this possible : "The Kellogg Group broke the 10% threshold in 1999, but failed to comply with the Early Warning Regime for almost 14 years until October 1, 2013, when it disclosed ownership of 33.0% of the outstanding MFC shares." Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted November 27, 2013 Share Posted November 27, 2013 Bizarre... Kellogg has always been a major shareholder of the Smith entities. Link to comment Share on other sites More sharing options...
skanjete Posted December 9, 2013 Share Posted December 9, 2013 Seems like an interesting story is unfolding : http://uk.advfn.com/news/BW/2013/article/60326456?xref=newsalert Link to comment Share on other sites More sharing options...
johnheiderscheit Posted December 11, 2013 Share Posted December 11, 2013 FWIW I am planning to vote for Kellogg. Although Smith is a smart guy and has made some excellent investments he is not suited by personality to be the #1 guy at a significant public company. The facts that he clings to the Chair/CEO/CFO combined roles and recently changed auditors were the last straws for me. I should probably just sell my shares and move on but my position is small and the entertainment value outweighs the potential loss. Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted December 11, 2013 Share Posted December 11, 2013 has made some excellent investments In my opinion he hasn't. If you look past all of the accounting gimmicks, he hasn't been good at creating value. He has been good at hiding value in spinoffs... when this value ultimately turns into book value, it looks like he has made money. Link to comment Share on other sites More sharing options...
constructive Posted December 11, 2013 Share Posted December 11, 2013 FWIW I am planning to vote for Kellogg. Same here. With some adult supervision in the Chairman and/or CFO roles I think Smith is likely to do a better job as CEO. Link to comment Share on other sites More sharing options...
skanjete Posted December 12, 2013 Share Posted December 12, 2013 another episode in the mud-throwing contest : http://uk.advfn.com/news/PRNUS/2013/article/60343561?xref=newsalert Link to comment Share on other sites More sharing options...
naboo Posted December 12, 2013 Share Posted December 12, 2013 another episode in the mud-throwing contest : http://uk.advfn.com/news/PRNUS/2013/article/60343561?xref=newsalert This will be back and forth till shareholders meeting. During this period of time, shareholders will suffer. does 33%-holding deserve couple seats on board? Hopefully MIL can go back to normal business after this. Link to comment Share on other sites More sharing options...
constructive Posted January 17, 2014 Share Posted January 17, 2014 MIL up today on news that they bought FESIL, a Norwegian ferrosilicon producer and metal supply chain company. http://www.fesil.no/index.php/pressreleases We don't know anything about profitability, but the purchase price sounds good: .15x revenues and .64x book (assuming FESIL is at least breakeven). Also if anyone missed the news from a couple of weeks ago, Kellogg/IAT successfully elected 2 boardmembers and plans to continue pushing for more shareholder representation on the board. Link to comment Share on other sites More sharing options...
constructive Posted January 17, 2014 Share Posted January 17, 2014 By spending a third of their cash they have increased MFC's revenue by ~60%. And probably a fair amount of FESIL is complementary to the existing business with potential improvement from scale. Link to comment Share on other sites More sharing options...
naboo Posted January 17, 2014 Share Posted January 17, 2014 After the director issue settled between MS and Kellogg, I am very confident of MIL. MS is good, we just need another guy to be there to work with him. Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted February 12, 2014 Share Posted February 12, 2014 http://www.mining.com/cliffs-cutting-capital-expenditures-by-50-laying-off-500-employees-94243/ Looks like the Wabush royalty should be impaired to zero. Link to comment Share on other sites More sharing options...
constructive Posted February 12, 2014 Share Posted February 12, 2014 http://www.mining.com/cliffs-cutting-capital-expenditures-by-50-laying-off-500-employees-94243/ Looks like the Wabush royalty should be impaired to zero. Ouch, bad news. This might reduce the value of MIL by over 15%, and the margin of safety by over 40%. I have given up and exited. It seems to be a pattern with me and commodity companies (not my preferred sector by any means). Link to comment Share on other sites More sharing options...
sculpin Posted January 21, 2015 Share Posted January 21, 2015 MFC collapsed to the low $4 level today from just above $7 at the start of the year. Obviously the Wabush mine asset should be written down substantially ($160MM). Still the Company sits on about $200 million of cash and had revenues in the $1 billion range annually as of the last quarter. MIL press release today says no change to warrant the sharp share price drop. Anyone still following? Link to comment Share on other sites More sharing options...
gfp Posted January 21, 2015 Share Posted January 21, 2015 I still follow it. Haven't owned any in quite a while. I believe the drop today was due to a sell recommendation from an Agora Inc. newsletter. I emailed with Rene today and shortly after they put out the press release. Not really interested in the company with Smith marginalized and this new guy as "CEO." Kellogg can't buy more at the moment and I'm not sure if that precludes the company from repurchasing shares that would increase his % interest - but this company has shown no interest in repurchasing shares below book value and that is pretty weak. There is always plenty of bad news to accompany any undervaluation and occasional attractive deals like Compton. Link to comment Share on other sites More sharing options...
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