Author Topic: AT - Atlantic Power Corp  (Read 94954 times)

valueinvestor

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Re: AT - Atlantic Power Corp
« Reply #250 on: January 15, 2021, 08:16:59 AM »
This is probably one of the reasons why value stocks have plummeted, because of actions such as these. I get that there has to be room for management to take a profit - but I don't understand why they can't pay a small premium on fair value, especially if they are going to make a lot more in the private market. A transaction like this - with the assets that they have - and the ability to be a private company and full control - it's not much of a risk to pay what's fair.

Not complaining but it's not the first time we saw value stocks being taken under or an activist coming in and selling it to the highest bidder or stripping it before moving on. 



SafetyinNumbers

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Re: AT - Atlantic Power Corp
« Reply #251 on: January 15, 2021, 09:41:22 AM »

longlake95

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Re: AT - Atlantic Power Corp
« Reply #252 on: January 15, 2021, 10:37:43 AM »
Can someone post a screen shot of the top holders of AT/ATP common?

ander

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Re: AT - Atlantic Power Corp
« Reply #253 on: January 15, 2021, 10:41:55 AM »
I am only speaking to the common shares. This proposal is grossly inadequate. I Squared is buying this for substantial upside. They are not paying $3 in the hopes of selling at $4, but more likely are betting on getting $6 to $9 of value.

Moore has preached a value based investment philosophy. He has been frustrated by the stock price as he indicated this morning given the progress that they have made. He now points to all the risks (we might not renew, FCF will be hard to cover MTN and Prefs) and wants to convince the shareholders it is time to sell (btw the referenced sales process in 2014 is a useless comparison). He points to how they have a declining EBITDA base and it is hard to get a multiple in the public markets for that situation - true, but it is much closer to leveling out -- and once Frederickson / Curtis Palmer renewals occur, the long-term visibility will become evident. Instead that visibility and re-rating of value will not happen in the public markets but in private hands where management will be rewarded handsomely.

As a Buffett fan, I'm sure Moore is fully aware that in this sale price is what you will be paid and value is what you give away. To point to the last 5 year stock price is misplaced. Yes, it is is frustrating given the progress that management has made and I would not have expected the stock price to have been here, but that is the opportunity as a public securities investor!! I have followed this company for 5 years and finally bought last year -- thinking that I was likely buying a $6+ for $2. Selling something worth $6+ for $3 is not satisfying.

I will be voting "No" re: this transaction. I'm happy for the stock price to settle back at $2.50 or whatever and work its way much higher as the team executes.
« Last Edit: January 15, 2021, 11:19:54 AM by ander »

Nelg

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Re: AT - Atlantic Power Corp
« Reply #254 on: January 15, 2021, 11:48:53 AM »
Can someone post a screen shot of the top holders of AT/ATP common?

Not sure how to post screenshots/images (is this forum ever going to enter the 21st century???), but see the below top 10 holders as of Sept 30:

Firm: # Shares Held / % of CSO

Neuberger Berman BD LLC:   7,290,977     8.172%
J.P. Morgan Asset Management, Inc.:  4,859,512     5.447%
BlackRock, Inc. (NYSE:BLK):  4,638,420     5.199%
Connor, Clark & Lunn Investment Management Ltd.:  3,644,859     4.085%
The Vanguard Group, Inc.:  3,312,927     3.713%
Mangrove Partners:  2,969,505     3.328%
Walthausen & Co., LLC:  1,961,490     2.198%
State Street Global Advisors, Inc.:  1,480,296     1.659%
RMB Capital Management, LLC:  1,400,000     1.569%
BNY Mellon Asset Management:  1,166,513     1.307%

Notes:
- Neuberger Berman: has held their stake for several years, and hasn't bought or sold much in the last couple years
- Connor, Clark & Lunn: increased their stake by 58% in Q3, and has been a long-time shareholder
- Mangrove Partners: used to be the largest shareholder a few years ago, then sold 71% of their shares in Q2, before buying back some of it in Q3

It's interesting that the only 2 questions on this morning's call were basically: 1) did you run a fully-marketed process, and 2) what's the break fee if someone tops your offer?

From the CEO's comments to question #1, it seems like there was no formal marketing process other than the 2014 one which as previously mentioned is a completely meaningless comparison. Anyway, I'm also in the same mindset as ander.

doc75

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Re: AT - Atlantic Power Corp
« Reply #255 on: January 15, 2021, 12:04:28 PM »
Can someone post a screen shot of the top holders of AT/ATP common?

Not sure how to post screenshots/images (is this forum ever going to enter the 21st century???), but see the below top 10 holders as of Sept 30:

Firm: # Shares Held / % of CSO

Neuberger Berman BD LLC:   7,290,977     8.172%
J.P. Morgan Asset Management, Inc.:  4,859,512     5.447%
BlackRock, Inc. (NYSE:BLK):  4,638,420     5.199%
Connor, Clark & Lunn Investment Management Ltd.:  3,644,859     4.085%
The Vanguard Group, Inc.:  3,312,927     3.713%
Mangrove Partners:  2,969,505     3.328%
Walthausen & Co., LLC:  1,961,490     2.198%
State Street Global Advisors, Inc.:  1,480,296     1.659%
RMB Capital Management, LLC:  1,400,000     1.569%
BNY Mellon Asset Management:  1,166,513     1.307%

Notes:
- Neuberger Berman: has held their stake for several years, and hasn't bought or sold much in the last couple years
- Connor, Clark & Lunn: increased their stake by 58% in Q3, and has been a long-time shareholder
- Mangrove Partners: used to be the largest shareholder a few years ago, then sold 71% of their shares in Q2, before buying back some of it in Q3

It's interesting that the only 2 questions on this morning's call were basically: 1) did you run a fully-marketed process, and 2) what's the break fee if someone tops your offer?

From the CEO's comments to question #1, it seems like there was no formal marketing process other than the 2014 one which as previously mentioned is a completely meaningless comparison. Anyway, I'm also in the same mindset as ander.

Do you think his calculus has changed in any way due to the dems taking control of senate?  I don't think this was really on the radar on the Q3 call. 

It sure seems that his tune has changed.  The simplest explanation is that he is speaking for his own best interest.  But I wonder if he may also
foresee several policy-based headwinds now that the dems are in full control.



ander

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Re: AT - Atlantic Power Corp
« Reply #256 on: January 15, 2021, 12:25:33 PM »
Unlikely his calculus changed. He had answered what his views were prior to the election - that regardless of outcome he was happy (though most mgmt teams say that, he went further for quite some time and in detail to explain why). Like some of their assets are likely to benefit b/c of likely federal policy. Some are driven by local market dynamics, etc.

His tune was pre-scripted and he didn't answer any real questions on the 11 minute call b/c he didn't want to go off script (as he himself said) and he didn't know what had been disclosed b/c of legal reasons. So the call was basically this is good for everyone and please vote yes.


[/quote]

Do you think his calculus has changed in any way due to the dems taking control of senate?  I don't think this was really on the radar on the Q3 call. 

It sure seems that his tune has changed.  The simplest explanation is that he is speaking for his own best interest.  But I wonder if he may also
foresee several policy-based headwinds now that the dems are in full control.



[/quote]

SafetyinNumbers

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Re: AT - Atlantic Power Corp
« Reply #257 on: January 15, 2021, 03:00:17 PM »
In my experience, itís doubtful in a management led buyout without running a process that, I Squared put forth the highest price they are willing to pay. I assume they are expecting to bump for the common and the pref.

With 18m+ shares trading today, up to 20% of the company changed hands. Hopefully into strong hands that will play hardball.


ander

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Re: AT - Atlantic Power Corp
« Reply #258 on: January 15, 2021, 03:59:25 PM »
In my experience, itís doubtful in a management led buyout without running a process that, I Squared put forth the highest price they are willing to pay. I assume they are expecting to bump for the common and the pref.

With 18m+ shares trading today, up to 20% of the company changed hands. Hopefully into strong hands that will play hardball.



100% agree.

SafetyinNumbers

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Re: AT - Atlantic Power Corp
« Reply #259 on: January 19, 2021, 08:34:50 AM »
This is a good blog that I think encapsulates the case for a bump well.

https://yetanothervalueblog.com/2021/01/quickie-idea-atlantic-power-arb-potential-bidding-war-at.html