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SYTE - Enterprise Diversified

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SmallCap:
I couldn't find a thread dedicated to this company even though it's been talked about before.

Interesting company that is going through some shareholder activism that is being led by one of our regular board posters

If you haven't see it check out these articles.

http://www.scavengerreport.com/2014/06/18/sitestar-corporation-strange-happenings-at-this-tiny-real-estate-play/

and straight from the pirate himself

http://ragnarisapirate.blogspot.com/2014/06/starting-activism-at-sitestar-syte.html

DTEJD1997:
I've known Jeff for a while and have every confidence in him.  He is an expert when it comes to residential real estate.  He is PERFECT for the BOD of Sitestar.

He is also a great value investor for small cap stocks.

Unfortunately, there is already a thread on this...

Sportgamma:
I had spotted that Jeff was said to be 50 years old according to the SYTE filings and found it amusing. Not so much after reading the letter and blog post from Jeff.

The scenario that he describes in the letter and blog are outrageous. No board meetings, CFO refuses to meet a board member, they put his signature on the filing without his consent or him even seeing the filing.

I own some shares based on the thesis that cost accounting of the properties understates the true book value of the properties. However, with this out in the open my main worry is that a cockroach in the kitchen is hardly the only one.

Another concern I have is this: As I see this, there is no misunderstanding between the two sides and things wonīt get patched up. Either management leaves or they donīt. The CEO owns about a third of the shares. Their primary option will be to attempt to buy the activists out. They might try to go dark with the company. As somebody belonging to neither of these groups, my primary concern as to the outcome, is that the activists leave and Iīll be stuck with current management and trapped in a stock with no liquidity.

rkbabang:

--- Quote from: Sportgamma on June 25, 2014, 02:49:12 AM ---I had spotted that Jeff was said to be 50 years old according to the SYTE filings and found it amusing. Not so much after reading the letter and blog post from Jeff.

The scenario that he describes in the letter and blog are outrageous. No board meetings, CFO refuses to meet a board member, they put his signature on the filing without his consent or him even seeing the filing.

I own some shares based on the thesis that cost accounting of the properties understates the true book value of the properties. However, with this out in the open my main worry is that a cockroach in the kitchen is hardly the only one.

Another concern I have is this: As I see this, there is no misunderstanding between the two sides and things wonīt get patched up. Either management leaves or they donīt. The CEO owns about a third of the shares. Their primary option will be to attempt to buy the activists out. They might try to go dark with the company. As somebody belonging to neither of these groups, my primary concern as to the outcome, is that the activists leave and Iīll be stuck with current management and trapped in a stock with no liquidity.

--- End quote ---

I'm in the same boat as you, although SYTE is a tiny position for me and I have no plans to buy more at the moment, so I'm just in wait and see mode right now.

One concern of mine is the unknown current condition of the properties. How many of them are not occupied? Are they being checked on and maintained or are they just sitting there abandoned?   Any property owner knows what it takes to maintain a property and I'm concerned that this might not be taken care of sufficiently here.   The properties page on the website, doesn't seem to change very often. How much capital will it take to get the properties ready to be rented/or for sale if they are allowed to deteriorate?  There are a lot of unknowns here for us outside shareholders.

More info about Sitestar that I'll add to this thread:

The old thread in the General category -  Topic: The Pirate has hijacked a seat on Sitestarīs board

Arquitos Capital's Letter to Sitestar’s management - August 28, 2013  (A lot of good suggestions. A reverse split is a no-brainer and should be done immediately).

The recent 13D filing including the Letter to management - June 3, 2014

And also required reading are all of Jeff's blog posts on Sitestar in order:

     Sitestar: The Cigar Butt That Isn'tAugust 1, 2011     Scut-Scut-Scuttlebutt... March 4, 2012     Why I Am 13D-ing SitestarMay 30, 2012     Sitestar Properties For Sale/RentJune 23, 2012     Portrait Of A CEO: Frank ErharticSeptember 1, 2012     A Board Seat At Sitestar...October 31, 2013     Starting Activism at Sitestar (SYTE)    June 23, 2014

writser:
What surprises me is that the 'portrait of a CEO'-post was really positive about Frank Erhartic. Ragnar gets a board seat, looks forwarding to working together with two incredibly nice and shrewd managers. Hardly two years later he has to go activist because the CFO is fleeing out of the office when he arrives. The whole drama reminds me of Walter Schloss: 'I’m not very good at judging people. So I found that it was much better to look at the figures rather than people. I didn't go to many meetings.'. Probably he experienced stuff like this too ... I really appreciate what Ragnar is trying to achieve and I hope it works out for all of you involved. I'll follow it from the sidelines with a bag of popcorn though.

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