Author Topic: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?  (Read 138271 times)

sculpin

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #510 on: March 14, 2019, 10:31:55 AM »
They have various alternatives...

Cash bid for all of the E pref's at $17.50 would cost them $63mm cash. Use bank line & some cash from current holdings.
Put forward an extension of the E's by a year or more
Some combination of cash & common or other prefs to settle the E's

Seems ridiculous to redeem them for common when the potential dilution is so high - believe this is only a bargaining tactic. Especially when they have $160mm in value sitting in DPM shares.

My NAV calc right now ranges from $3.38/share to $5.00/share with the $3.38 valuing all prefs at par & the $5.00/share NAV taking current market prices for all prefs. This NAV assigns $0 value to the Parq development.

Cash at the end of Sep was $26mm and they received $14.5mm from Union, $24 from Dundee Securities and probably burnt about $20mm in G&A and the pref dividends. So current cash absent other asset sales should be around $40mm.


bskptkl

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #511 on: March 14, 2019, 11:58:14 AM »
I own both preferreds and common - so take this the right way. Can someone remind me of the last smart thing these guys have done? I know Ned has done some smart things going way back. I'm talking about  the last few years.

sculpin

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #512 on: March 14, 2019, 12:39:45 PM »
I own both preferreds and common - so take this the right way. Can someone remind me of the last smart thing these guys have done? I know Ned has done some smart things going way back. I'm talking about  the last few years.

Not much but holding onto DPM and undertaking the process to simplify the conglomerate are steps in the right direction.

gokou3

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #513 on: March 14, 2019, 03:10:08 PM »
They have various alternatives...

Cash bid for all of the E pref's at $17.50 would cost them $63mm cash. Use bank line & some cash from current holdings.
Put forward an extension of the E's by a year or more
Some combination of cash & common or other prefs to settle the E's

Seems ridiculous to redeem them for common when the potential dilution is so high - believe this is only a bargaining tactic. Especially when they have $160mm in value sitting in DPM shares.

My NAV calc right now ranges from $3.38/share to $5.00/share with the $3.38 valuing all prefs at par & the $5.00/share NAV taking current market prices for all prefs. This NAV assigns $0 value to the Parq development.

Cash at the end of Sep was $26mm and they received $14.5mm from Union, $24 from Dundee Securities and probably burnt about $20mm in G&A and the pref dividends. So current cash absent other asset sales should be around $40mm.

(Putting myself into Goodman's shoes)
"So let's see, should I screw the common shareholders (which my family owns 20% of) or the Series 5 holders?  Of course the Series 5 guys.  Why not give the patsies a stick and a carrot - they can either...

1) convert their series 5 shares for commons per prospectus and get a 32% immediate haircut (based on today's DC.A closing price, without assuming further price pressure from such event), or...

or

2) convert to the "Series 6" preferred with a 2022 maturity at 7.5% dividend rate, AND A PAR VALUE OF $20.  This would be a lesser 20% haircut, and will almost make the holder whole 3 years later after dividends.  Also, this offer would be a 10%+ premium to the current Series 5 prices to encourage the new-ish shareholders and arbitrageurs to bite.  This also eliminates $16M of liability in one stroke without any dilution."


---------

I think the "series 6 conversion" scenario is quite likely. Of course, I am biased as a Series 2 & 3 pref holder.

bizaro86

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #514 on: March 15, 2019, 08:18:06 AM »
Yeah, I can't see any reasons why the Goodmans would choose to pay in cash and in full. I think the most likely scenario is they offer some sort of haircut (either cash or new paper) and a conversion to common for those who don't take it. That will hurt the common short term, making the conversion even more attractive.

sculpin

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #515 on: March 22, 2019, 12:00:48 PM »


Roumell Opportunistic Value Fund Institutional Class Shares

Portfolio Holdings as of 2/28/2019


Ticker   Cusip   Description   Shares   Market Value   % of Portfolio

TOIXX   60934N500   Federated Treasury O bligations Fund   14,416,240.830   $14,416,240.83   18.72%
912796RP   912796RP6   TREASURY BILL 05/09/2019 0%   7,550,000.000   $7,514,624.48   9.76%
RUBI   78112V102   Rubicon Project Inc/ The   968,400.000   $5,684,508.00   7.38%
DDEJF   264901109   Dundee Corp   3,680,240.000   $3,993,060.40   5.18%
ENZ   294100102   Enzo Biochem Inc   1,109,870.000   $3,751,360.60   4.87%
GSIT   36241U106   GSI Technology Inc   380,352.000   $3,080,851.20   4.00%
MCC   58503F106   Medley Capital Corp   889,751.000   $3,078,538.46   4.00%
ATEN   002121101   A10 Networks Inc   426,750.000   $2,978,715.00   3.87%
PRTK   699374302   Paratek Pharmaceutic als Inc   442,467.000   $2,867,186.16   3.72%
LQDT   53635B107   Liquidity Services I nc   411,479.000   $2,839,205.10   3.69%
912828J7   912828J76   US TREASURY N/B 3/31/2022 1.75%   2,500,000.000   $2,445,703.25   3.18%
SWIR   826516106   Sierra Wireless Inc   186,950.000   $2,351,831.00   3.05%
55382940   553829409   MVC CAPITAL INC 11/30/2022 6.25%   87,340.000   $2,281,320.80   2.96%
912828P9   912828P95   US TREASURY N/B 3/15/2019 1%   2,000,000.000   $1,999,961.16   2.60%
SAND   80013R206   Sandstorm Gold Ltd   302,400.000   $1,684,368.00   2.19%
05580M40   05580M405   B RILEY FINANCIAL IN C 12/31/2027 7.25%   65,080.000   $1,601,033.08   2.08%
ZAGG   98884U108   ZAGG INC   130,690.000   $1,516,004.00   1.97%
26980940   269809406   EAGLE POINT CREDIT C O 9/30/2027 6.75%   46,433.000   $1,181,673.42   1.53%
ALYA   01643B106   Alithya Group Inc   418,463.000   $1,127,757.79   1.46%
14050120   140501206   CAPITAL SOUTHWEST CO RP 12/15/2022 5.95%   43,875.000   $1,120,435.88   1.45%
69181V20   69181V206   OXFORD SQUARE CAPITA L CO 3/30/2024 6.5%   44,099.000   $1,111,912.19   1.44%
SEAC   811699107   Seachange International Inc   765,650.000   $1,110,192.50   1.44%
HCHC   404139107   HC2 Holdings Inc   327,880.000   $1,032,822.00   1.34%
DXLG   25065K104   Destination XL Group Inc   385,124.000   $1,005,173.64   1.31%
RST   777780107   ROSETTA STONE INC   56,724.000   $913,823.64   1.19%
SD   80007P869   SandRidge Energy Inc   115,000.000   $893,550.00   1.16%
EGO   284902509   Eldorado Gold Corp   185,948.000   $808,873.80   1.05%
LEAF   52177G102   LEAF GROUP LTD   98,900.000   $804,057.00   1.04%
37654660   376546602   GLADSTONE INVESTMENT COR 8/31/2025 6.375   30,000.000   $765,180.00   0.99%
67401P20   67401P207   OAKTREE SPECIALTY LE ND 10/30/2024 5.875   27,183.000   $685,011.60   0.89%
MCHX   56624R108   Marchex Inc   85,508.000   $370,249.64   0.48%
COLOS/WS   94708109   COLOSSUS MINERALS   633,881.000   $6,338.81   0.01%
Totals   38,812,677.830   $77,021,563.41

Cardboard

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #516 on: March 25, 2019, 11:09:10 AM »
I would buy more if I was not afraid of a disaster in Chad. Amazing that we have not heard anything yet.

Meanwhile DPM continues to outperform and I am glad to own some instead of just this dog.

Cardboard

SafetyinNumbers

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #517 on: March 28, 2019, 03:15:55 PM »
They really converted those pref to shares but also promised a buyback in the common after the conversion, maybe.

http://www.globenewswire.com/news-release/2019/03/28/1788028/0/en/Dundee-Corporation-Announces-Conversion-of-First-Preference-Shares-Series-5.html?ev=1
Top 5 positions: ELF IAM GCM.NT/GCM PIF EFR.DB

Rod

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #518 on: March 28, 2019, 03:19:41 PM »
They really converted those pref to shares but also promised a buyback in the common after the conversion, maybe.

http://www.globenewswire.com/news-release/2019/03/28/1788028/0/en/Dundee-Corporation-Announces-Conversion-of-First-Preference-Shares-Series-5.html?ev=1

I was expecting it and have been buying up B/D prefs in the last few weeks in anticipation. Any predictions on trading activity tomorrow? I would expect the B/D to be up nicely because they now have much more equity coverage and are becoming increasingly safe. Common probably down, but the potential for a large buyback may mitigate that.

SafetyinNumbers

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Re: Dumbdee - The Goodmans, The Bad & The Ugly - 30% of NAV bargain?
« Reply #519 on: March 28, 2019, 04:00:40 PM »
They really converted those pref to shares but also promised a buyback in the common after the conversion, maybe.

http://www.globenewswire.com/news-release/2019/03/28/1788028/0/en/Dundee-Corporation-Announces-Conversion-of-First-Preference-Shares-Series-5.html?ev=1

I was expecting it and have been buying up B/D prefs in the last few weeks in anticipation. Any predictions on trading activity tomorrow? I would expect the B/D to be up nicely because they now have much more equity coverage and are becoming increasingly safe. Common probably down, but the potential for a large buyback may mitigate that.

You would think so on the B/D but it also demonstrates that management doesn't think the NAV is all that hard, especially when you combine it with the big loss today. What discount to NAV should the pref trade at?

I think the common will get hit pretty hard but the real test will be when the conversion is complete and we have some time to trade. A lot of these pref holders didn't use their opportunity to tender at par on those two previous opportunities so I don't know how closely they are monitoring their position. Maybe they will just miss the income and sell then.
Top 5 positions: ELF IAM GCM.NT/GCM PIF EFR.DB