Posts for Ticker ‘LEND’

Pre-Market Stock News (September 19, 2007)

(AIR) AAR Corp. $0.36 EPS vs $0.39 est.
(CMO) Capstead Mortgage will sell 8.5M shares of common stock.
(DT) Deutsche Telecom’s T-Mobile won iPhone exclusivity in Germany.
(EPAY) Bottomline Technologies announced a strategic pact with Wipro Technologies of Wipro to provide corporate payments and global cash management solutions to financial institutions.
(ETEL) eTelecare Global (ETEL) is acquiring AOL’s Customer Care & Technical Support subsidiary.
(GIS) General Mills $0.81 EPS vs $0.79 estimate.
(KMX) CarMax $0.29 EPS vs $0.29e; lowered 2008 guidance to $0.92-0.98 vs. prior guidance of $1.03-1.14.
(KWD) Kellwood received a $21 non-binding offer proposal from Sun Capital.
(LEND) Accredited Home Lenders Holding Co. trading up 17% at $11.50 as Lone Star and it agreed on a lowered $11.75 buyout price.
(MS) $1.38 EPS vs $1.54 estimate; will take $940 million or $0.33 per share in writedowns; $480 million in quantitative strategies.
(PAA) Plains All American Pipeline’s subsidiary Plains L.P.G. Services has signed a definitive agreement to acquire the Tirzah L.P.G. storage facility from Suburban Propane and Suburban Pipeline for approximately $55 million.
(RNVS) Renovis to be acquired by Evotec in an all stock transaction valued at approximately US$ 151.8 million.
(TASR) TASER won a U.S. Forest Service purchase order for 700 TASER X26 electronic control devices.
(XMSR/SIRI) XM & Sirius trading down on UBS downgrade, and Wisconsin AG sent letter to US Atty General asking him to block the merger.

Jon C. Ogg
September 19, 2007

Posted on: September 19, 2007 – 7:34 am in Pre-Market Activity, , , , , , , , ,

Accredited Home Lenders Still Has Hopes Of Merger, But… (LEND)

LSF5 Accredited Investments, LLC, the subsidiary of Lone Star Fund V that had offered in June to acquire Accredited Home Lenders Holding Co. (Nasdaq: LEND), announced that it is extending its tender offer for all outstanding shares of common stock until 12:00 midnight on September 14, 2007, in accordance with Lone Star’s obligations under the merger agreement with the Company.  If you read the press release, you’ll see right away that this is not a done and final deal as far as Lone Star is concerned, although it is still not as dead as fears of the subprime meltdown led to in August.

Read More »

Posted on: September 13, 2007 – 8:06 am in Financial Stocks, , , ,

Accredited Home Lenders Sends Loans To Vulture Investors (LEND)

Accredited Home Lenders Holding Co. (NASDAQ:LEND) has issued a press release saying that it has entered into an agreement to trade approximately $1 billion of loans under a 90-day purchase agreement with an investor at an advance rate comparable to the advance rates the company is currently receiving from warehouse lenders.  Shares were initially up only 2% pre-market, but now shares are up closer to 8% around $7.00 on rising volume.

The initial settlement of a pool consisting of approximately $500 million closed on Friday, August 17, 2007, with the remaining loans trading every other week as borrowers make their first payments due under the loan. The final sale of the loans is expected to occur by October 2007.  Accredited has the ability but not the obligation, in its sole discretion, to repurchase all of the loans traded through mid-November 2007 at a premium to the advance rate. If the loans are not repurchased by the Company by mid-November, the Company’s call right to repurchase the loans expires and the investor will keep the loans with limited recourse to the Company.

James A. Konrath, chairman & CEO, stated "If the market improves to a rational level, our intention is to repurchase these quality loans by mid-November and sell or securitize them."

It is anticipated that the transaction will neither produce nor use any significant liquidity at time of funding, but this will reduce AHL’s exposure to margin calls on these loans since the agreement does not permit the investor to decrease the advance rate during the 90-day repurchase period. 

Here is how the company says it will look after the transaction: Accredited has approximately $600 million of loans not covered by this agreement funded by warehouse credit facilities and Company cash.  Terms of the transaction include a small holdback reserve to allow thepurchaser to reject loans that do not meet certain criteria.

For those of you who are not familiar with these "other investors" out there, it sure sounds like there is starting to be some vulture investing out there where investors are gobbling up mortgage loans on the cheap.  We noted some vulture activity starting to be seen just yesterday.  Prices are all over the place depending upon the collateral and the structure of each loan pool traunch.  The good news is that this looks like it will get the bulk of the loans off the books.

Jon C. Ogg
August 21, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: August 21, 2007 – 7:22 am in Financial Stocks, Housing, ,

More on Pending Merger Arb Spreads (FRK, LEND, ACXM, DJ, NWS, VMC, APPB, IHP)

Earlier today, we sent out a couple pieces discussing some of the pending mergers and spreads still having wide ranges.  This can be indicative of a deal at risk, but some will close and will offer significant opportunities for those willing to tread where others fear. Our first list included some of the larger names out there (ACS, URI, FDC, CCU) and then we covered a second batch (TXU, TRB,SLM, CEN).  We’ll be sending out some specific calls to subscribers of our Special Situation Investing Newsletter ahead of Labor Day.

The Dow Jones (NYSE:DJ) buyout by Rupert Murdoch’s News Corp (NYSE:NWS) isn’t aprivate equity transaction, but it might as well be.  With a $60.00buyout, the current $58.70 price does not signal much perceived risk inthis deal closing.  Rupert wants it and he has won the deal.  There isa reason Murdoch made the list of entrenched leaders, and the fact that he gets his way is the largest part of it.

Florida Rock (NYSE:FRK) shareholders have already agreed to the buyoutby Vulcan Materials (NYSE:VMC), but at $61.00 this is well under the $68.03cash and stock deal.  This was at a large 40+% premium, so the VMCshare price being lower not act as a hurdle and that old price and thisone should be expected to close.

Acxiom’s (NASDAQ:ACXM) $27.10 buyout offer from SilverLake and Value Actcurrently has only a $23.25 price, giving it a 14% discount to thebuyout price, or actually a 16.5% return from the current price for themerger-arbs.

Accredited Home Lenders Holding Co. (NASDAQ:LEND) is still a deal completelyat risk as the Lone Star buyout has been extended and no one expectsthat $15.10 price to be done. LEND is suing Lone Star to close thedeal, but if this one gets done at all it would be only logical that itwould close at a far lower price.

We still view the old Applebee’s (NASDAQ:APPB) acquisition by IHOP (NYSE:IHP) being a takeunder, and we didn’t see much premium value when that had spiked up earlier this year in hopes of a deal.

This is a mere sample of pending mergers we are covering to look for opportunities in the Special Situation Investing Newsletter our paid subscribers access.  We will be covering some of these and others with exact plays ahead of the Labor Day holiday.

Jon C. Ogg
August 20, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: August 20, 2007 – 1:25 pm in Mergers and Buy Outs, , , , , , , ,

After More Than 90% Plunges, Investors May Be Nibbling In Mortgage Land (LUM, LEND, NLY)

Luminent Mortgage Capital Inc. (NYSE:LUM) and Arco Capital Corporation Ltd. have entered into a Letter of Intent outlining current and proposed transactions intended to address Luminent’s current liquidity issues that arose due to unanticipated disruptions in mortgage credit markets.  There are conditions of course, but ARCO will repurchase approximately $65 million in mortgage securities, has been issued warrants by Luminent to purchase up to a 49% voting equity stake and 51% economic interest in Luminent (at $0.18 per common share exercisable over a 5-year period).  The Board of Directors of Luminent will resolve to elect four new members to the Board of Directors and four existing directors will submit their resignations from the Board, conditioned upon the newly elected members agreeing to serve on the Board.

Additional transactions in the letter of intent would provide Luminent with access to up to approximately $60 million in additional capital through repurchase agreements or secured credit arrangements with the intention of addressing current or impending margin calls and financing maturities.

While additional notices of default and margin calls remain a possibility in the current environment, as of August 17, 2007, Luminent has outstanding notices of default for unfunded outstanding margin calls totaling approximately $30.9 million, with approximately $6.1 million of cash being held to effectuate refinancing, for a net total current need of approximately $24.8 million. As Luminent previously announced, a default occurred under the indenture relating to $90 million of Luminent’s 8.125% Convertible Senior Notes due 2027. The trustee under the indenture has subsequently notified Luminent of an event of default, but has not yet declared those notes to be immediately due and payable.

According to the Letter of Intent, going forward, Luminent’s business strategy is expected to include acting as a multi-channel manager for asset- backed securities.  So investors are starting to snap up more and more assets on the cheap it looks like.  A letter of Intent is not binding per se because the conditions would allow it to back out, but maybe the buying on the cheap will come up more.  Luminent shares closed at $0.75 on Friday, and its 52-week trading range is $0.36 to $10.84.

Elsewhere, Accredited Home Lenders Holding Co. (NYSE:LEND) shares are up another 3% pre-market at $6.97.  If you will recall, just on Friday we showed how this Chimera IPO filing with Annaly Mortgage (NASDAQ:NLY) was actually a vulture fund set up to buy mortgage and loan assets on the cheap.

Jon C. Ogg
August 20, 2007

Posted on: August 20, 2007 – 7:23 am in Financial Stocks, Housing, , ,

Top Financial Gappers on Discount Rate Cut (GS, BSC, LEND, ETFC, TMA, NLY, WM, WFC, CFC, MBI, PMI)

These intra-meeting cuts like the 50-basis point discount rate cut this morning, even if this one is the discount rate rather than the funds rate, do act as stabilizers and you are seeing it in the financials directly and in most of the other sectors.  We hate to look a gift horse in the mouth, but when these rate cuts occur pre-market the actually tend to not be as good for traders as they are when the FED does this during trading hours.  Some of these gaps may hold, but it won’t be a huge shock if some of these give a little back after these huge gap ups this morning.  The fact that today is stock options expiration date may also create some different actions.  Needless to say, there is a massive amount of short covering going on and this may have staved off another horrible day in the markets after Asia opened and slid massively.

This is just a small sample of the gappers, but here goes:

Goldman Sachs (GS) +3.78 at $176.27.

Countrywide (CFC) +18% at $22.40.

Accredited Home Lenders (LEND) +15% at $7.58.

Thornburg Mortgage (TMA) +27% at $15.85.

Annaly Capital Mgmt. (NLY) +6.5% at $14.97.

Washington Mutual (WM) +9% at $38.75.

Wells Fargo (WFC) +4.8% at $37.00.

E*Trade (ETFC) +14% at $15.50.

Bear Stearns (BSC) +7.4% at $125.00.

MBIA (MBI) +6.5% at $60.00.

PMI Group (PMI) +16% at $33.00.

Jon C. Ogg
August 17, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he is the publisher of the 24/7 Wall St. Special Situation Investing Newsletter and does not own securities in the companies he covers.

Posted on: August 17, 2007 – 8:39 am in Banking, Brokerage Firms, Financial Stocks, HI/LOW, , , , , , , , , , ,

Accredited Home Lenders, Maybe Not So Accredited (LEND, AHM)

Accredited Home Lenders Holding Co. (NASDAQ:LEND) is in trouble this morning.  Shares were down 30% in pre-market activity after an SEC Filing from the company warned of solvency issues, although the trading has improved a bit since then.  The company even issued a ‘going concern’ note on itself.  Apparently the company is worried that after the debacle at American Home Mortgage (NYSE:AHM), creditors and lenders may place margin calls on it as values of the underlying mortgages come under more and more questions.  Unfortunately it can have these margin calls on a one-day notice.  This wouldn’t be the first margin call it ever received, but things have deteriorated further and finding firms that are willing to be white knights or that can come to aid is nearly impossible right now if you are a lender in the soup.

Lone Star Funds has a buyout offer for Accredited Home Lenders, but the obvious fear is that it will either back out entirely or that it will take the juice out of the buyout.  The company is also trying to renegotiate terms to avoid defaulting and avoid a liquidity crunch.  It is also now delinquent in SEC filings.  Accredited Home Lenders shares are down over 20% to just over $6.25.  Its 52-week trading range is $3.77 to $47.82.

How would you like to own that at $40+ and be wondering if the company can make it back up there?  You know that happened to some.  Ouch.

Jon C. Ogg
August 2, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: August 2, 2007 – 8:40 am in Financial Stocks, SEC, Shareholder Issues, , , , ,

American Home Mortgage Carnage Continues in Mortgage Land (AHM, BSC, LEND, NLY, CHC, TMA)

American Home Mortgage Corp. (NYSE:AHM) shares traded over 30 million shares yesterday after being halted for a day and a half.  It is likely that the sub-Saharan tribal residents know of the company’s woes by now and the story has been well exposed.  This was somewhere around an 85% drop yesterday with shares closing down at $1.04 on the day.

This morning, shares are back to $1.01, but it appears that shares traded as high as $1.33 on the day.  There are many who now believe that the margin calls and inverted liquidity crunching its books will implode the company.  It is trying to secure financing, and that will be up to you to decide if they can secure it or not.  We have seen roughly 6 million shares trade so far in the first 15 minutes of trading and it is expected that this will be one of the most active stocks on the day.

As always in near-implosion names, beware the rumor mill as chat room investors talk shares both up and down on no news out of the company.  Other mortgage names are seeing pressure as well after Bear Stearns (NYSE:BSC) is reportedly having another fund write-off.  Accredited Home Lenders (NASDAQ:LEND) are down over 4% today; Annaly Capital Management (NYSE:NLY) is down 1.1%, Thornburg Mortgage Inc. (NYSE:TMA) is down roughly 6%, and Centerline (NYSE:CHC) is down nearly 6%.

Jon C. Ogg
August 1, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: August 1, 2007 – 8:53 am in Financial Stocks, , , , , , ,