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Egan-Jones On Why Carl Icahn's CIT Overtures Are Irrelevant
Rating agency Egan-Jones provides color on why Icahn's most recent overture to CIT, while admirable in its activism, is likely not going to generate much if any traction. The summary: hold out for liquidation, as that is the best way to recoup any value, instead of staying with a terminally sinking ship. Yet the song and dance is likely to continue.
From Egan-Jones:
Synopsis: Forget Icahn, forget the exchange - Neither Icahn's offer nor the revised exchange (which reduces maturities by 6 mos.) provides the best value to creditors. Creditors can realize more value via a sale/liquidation of CIT assets. Most bondholders should reject the proposed offers. Our liquidation analysis uses a value of 70% on CIT's loans and creditor's realizing 82.5% upon liquidation and 68.5% on a PV basis (using a more realistic value of 75%, the realization is 85.7%). Any bondholder offered less than 90% should reject; the $5.7B debt reduction is not enough to obtain competitive funding and therefore might necessitate another exchange. The main problem would be addressed with an owner such as JPM, WFC, BRK, GE, or PNC.
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GE and GS wants these guys gone. Just a matter of time. GS profits and GE gets their business.
XXX rated video
http://money.cnn.com/video/fortune/2009/10/16/f_sl_blankfein_goldman_com...
We contribute to growth by saying who grows and who shrinks by making money availble to who we choose.
Is there anyone or any institution on Wall Street or any street who can just suck it up and take a loss?????
+1
Mr Durden, you gotta check this scary 8 facts out:-
http://www.moneyandmarkets.com/bernanke-gone-berserk-bank-reserves-explo...
OMG!!!
The amazing thing about human psychology is that after the system has been shocked, it becomes desensitized in self defense. So charts such as the one you show in the article link that would send a normal person running to the caves are now seen as just more of the same. Ho Hum, next.
Where once a hundred billion dollars was a lot of money, we now talk about trillions of dollars like it's small change toilet paper.
Oh......wait...... it is.
Goldman and Bank of Amerika run the markets along with Geithner, and beagle boy Ben. There is no free markets, only welfare capitalism and socialism for capitalism.
good articles; good articles 4 slow news day ..http://www..
hat tip: finance news
CIT deserves the gutter-rat Icahn, good luck with that....
Forget logic, bid this MF up!