Author Topic: BH - Biglari Holdings  (Read 1360549 times)

vpagano

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Re: BH - Biglari Holdings
« Reply #220 on: August 26, 2013, 11:03:08 AM »
By the way, did anyone notice this in the prospectus: "You may exercise any number of your subscription rights, or you may choose not to exercise any subscription rights.  We will not distribute any fractional shares of common stock or pay cash in lieu of fractional shares.  We will round up the aggregate number of shares of common stock you are entitled to receive to the nearest whole number provided you fully exercise your rights and pay the full subscription price."

In other words, you could buy one share for $467 and exercise your right for $265. In the end you'll have spent $732 and have two shares worth $866 @ $433 a piece. That's a free $134! Hey, it might not be much but at least you can order 33 things off of the $4 Steak and Shake menu.

agaglio - this section is worded oddly to me. Have you confirmed this with your broker? Mine says this section refers to treatment of fractional shares of BH and the rights associated you will receive is based on the next whole number. Personally, the rep wasn't that knowledgeable (probably very wrong) and I had her reference it to the Reorg. department to read over and email me back.

The reason I ask is because if what you say is true, you could simply buy one right and exercise it to buy a discounted share. As long as right + exercise cost + $265 < $430 then you made a few dollars. Non-retail guys around here can laugh but hey it's free beer money.


APG12

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Re: BH - Biglari Holdings
« Reply #221 on: August 26, 2013, 11:26:56 AM »
Hey Vince,

I actually have no idea if it would work as I described. I have a number of shares divisible by 5 so it doesn't affect me. Sorry I'm not more help.

giofranchi

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Re: BH - Biglari Holdings
« Reply #222 on: August 27, 2013, 11:31:18 PM »
From what I can see on its 10q-q3-2013 filing, BH equity at July 3, 2013, was $482 million.
The Company’s proportional share of its common stock, as held by the investment partnerships and recorded as Treasury stock, amounted to 105,670 shares, which at yesterday price of $408 are worth $43 million.
BH will receive $76 million in cash from the issuance of 286,767 shares.
Therefore, total equity will be: $482 + $43 + $76 = $601 million.

Shares outstanding at August 5, 2013, were 1,433,835. With the issuance of new shares the total outstanding will be: 1,433,835 + 286,767 = 1,720,602.
At yesterday share price of $408, market cap is: $408 x 1,720,602 = $702 million.

Therefore, BH is selling for $702 / $601 = 1.17 x BV.

If my numbers are wrong, please correct me!

giofranchi
« Last Edit: August 27, 2013, 11:34:08 PM by giofranchi »
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gg

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Re: BH - Biglari Holdings
« Reply #223 on: August 28, 2013, 06:53:54 AM »
Giofranchi - are you sure that the $43m treasury shares are not already accounted for in the $482m figure? I'm not entirely sure how BH accounts for stock that they own in themselves through an 'investment partnership'. If the company-owned BH stock is held in the Lion Fund, then that $43m might be included in the "Equity in investment partnerships" of $337m, in which case you are double counting it.

giofranchi

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Re: BH - Biglari Holdings
« Reply #224 on: August 28, 2013, 07:35:55 AM »
Giofranchi - are you sure that the $43m treasury shares are not already accounted for in the $482m figure? I'm not entirely sure how BH accounts for stock that they own in themselves through an 'investment partnership'. If the company-owned BH stock is held in the Lion Fund, then that $43m might be included in the "Equity in investment partnerships" of $337m, in which case you are double counting it.

Quote
As of July 3, 2013 the carrying value of the equity in the investment partnerships was $337,479, excluding $43,581 classified as Treasury stock representing our proportional share of Company common stock held by the investment partnerships.
--page 8

Treasury stock on the Balance Sheet are a reduction to Shareholders’ equity. Therefore, I don’t think I am double counting it.
But I might be wrong… If anyone is sure about this, I would gladly hear from her/him! :)

giofranchi
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giofranchi

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Re: BH - Biglari Holdings
« Reply #225 on: September 16, 2013, 06:47:30 AM »
Today I already see on my firm’s bank account not only the BH shares I should have received through regular subscription, but also all the shares I could have received through oversubscription…
Is this possible?! ???

giofranchi
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ragu

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Re: BH - Biglari Holdings
« Reply #226 on: September 16, 2013, 07:04:14 AM »
Today I already see on my firm’s bank account not only the BH shares I should have received through regular subscription, but also all the shares I could have received through oversubscription…
Is this possible?! ???

giofranchi,

I'd say unlikely seeing as the representative at my brokerage said it'd be around 2 weeks after the offering closed before the shares are allotted (and I checked, the shares from the rights aren't there for me yet). Yet, you see yours. Interesting.

Just out of curiosity, what % of shares (based on what was potentially available to you) did you get from the over-allotment?

Best,
Ragu



wellmont

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Re: BH - Biglari Holdings
« Reply #227 on: September 16, 2013, 07:09:51 AM »
Today I already see on my firm’s bank account not only the BH shares I should have received through regular subscription, but also all the shares I could have received through oversubscription…
Is this possible?! ???

giofranchi

that's a placeholder showing your total possible exposure. if you don't get all the over subscribed shares you will get rebated.

giofranchi

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Re: BH - Biglari Holdings
« Reply #228 on: September 16, 2013, 07:15:27 AM »
Just out of curiosity, what % of shares (based on what was potentially available to you) did you get from the over-allotment?

Best,
Ragu

100% of the over-allotment!! There surely must be something wrong… Yet I don’t see the Rights anymore… Instead, I see all the shares!!
I also thought the shares would be allotted 2 weeks after the closing of the offering, because that’s exactly what was written on the prospectus too…
It is probably my bank that is messing something up… >:(
What a pity!!

giofranchi
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giofranchi

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Re: BH - Biglari Holdings
« Reply #229 on: September 16, 2013, 07:32:22 AM »
that's a placeholder showing your total possible exposure. if you don't get all the over subscribed shares you will get rebated.

Ah! Ok! That makes sense.
Thank you wellmont! :)

giofranchi
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