kevin: AIG to BUY OUT CNC RUMOR:
I have purposely not continued dwelling on the AIG rumor so as not to be accused of
" grasping at straws in the wind "
by shorts or longs. I have tried to stick to the facts only.
However I note today that it continues to be
discussed and I do that.
I gather here a sample of the best postson the subject:
I continue to think that Wendt is the key
for CNC or AIG or any other Insurance/Financial
operation in the US ( or even oversea: Wendt/GECapital had a lot of dealings in Japan
and was looking at expanding GECapital abroad ).
Here is Monday's article in Wall St. Jour.
on WELCH and GE and GECapital:
How soon we forget!!!
It mentions that in the last 5 years GECapital
which Wendt ran single-handedly , was responsible
for 50%!!!!!!!!!
of GE's profits
and how GE went from 50 bill to 550 bill ( 10X over )
PRIMARILY through GECapital and NBC.
The other lines of business ( refrigerators, plastics etc )
had essentially flat margins.
And yet NOT A SINGLE WORD ABOUT WENDT!! in all
the article.
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interactive.wsj.com
Message 14426219
September 18, 2000
Manager's Journal
Heir to Greatness
"The law of large numbers: Over the past decade GE's market value has multiplied eleven-fold --
to more than $560 billion from $50 billion at the end of 1990.
Over the past five years, profits in two sectors -- appliances and plastics -- were essentially flat.
Holding these businesses may generate a positive return on invested capital,
but no investor would keep them inside a growth portfolio. Why should GE?
If GE's next chairman can't muster the courage to leave the dawdlers behind,
perhaps he -- or she -- should spin out the stars.
Of the eight large business segments for which GE reports results,
two -- GE Capital and NBC -- account for nearly 50% of GE's five-year profit growth.
Sure, GE Capital has benefited from its parent's dirt-cheap cost of capital,
but from an investor's point of view, these advantages may be more than offset
by the drag of laggardly earnings growth in other GE businesses..
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I believe that Wendt will soon stand out again as
his own persona.
If AIG gets Wendt+CNC @ a modest $20 exchange
for AIG shares it WILL BE THE COUP OF THE YEAR or CENTURY??
in INSURANCE
and a WIN WIN situation for all
CNC
WENDT
Shareholders
AIG
TA
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Re: Rumor:AIG to buy CONSECO
messages.yahoo.com
by: americangrafiettee 9/21/00 10:20 am
Msg: 4344 of 4345
Please allow this outsider to jump in.
The acquisition of CNC might be a timely and very profitable one for AIG. CNC has or will be shedding all non-core assets, both on the insurance and finance side, so they will be a cleaned-up shop. The gain-on-sale accounting fiasco has been fixed. The debt restructure is completed, albeit not yet announced. A change of ownership allows all CNC execs with their absurd stock loans to exercise all outstanding stock options to get rid of the "bad" stock, and also allows the company to give them all a "soft landing" so as to avoid unfavorable bad press and future litigation, especially the anti-Christ former CEO Steve Hilbert. A very convoluted situation that space won't allow me to elaborate on here. AIG gets management superstar and Wall Street darling Gary Wendt to come in and run the whole thing, and also gets a much improved and very profitable consumer and commercial lending operation (when they have favorable money cost, which AIG provides) at a steeply discounted price, like under $30/share. Pretty much a win-win deal.
Any thoughts on the possible downside?
Posted as a reply to: Msg 4342 by nothingcommonaboutcommonsense
Re: Read The Following From TA's Hangout
messages.yahoo.com
by: edgemY 9/20/00 11:05 pm
Msg: 73384 of 73506
re.AIG – CNC combination.
I'm not saying it's more than a rumor (yet), but do not rush to dismiss it either (as some well known "ney-to-everything-CNC" posters here—"not a match", "AIG is too big, AAA rated, etc.).
Actually quite a few things DO MAKE SENSE for a CNC-AIG combination:
1.THIS IS FROM TODAY'S WSJ, p.A3:
"…AIG…Hugely profitable FINANCIAL SERVICES powerhouse with subsidiaries operating in 130 countries, including big
ASSET MGMNT.,
AIRPLANE LEASING and
CURRENCY TRADING OPERATIONS…"
Sounds ALMOST LIKE G.W.'s ex. GEC JOB description….
2. re. "AIG is too big, AAA rated, etc." argument—THAT IS JUST IT – THIS IS WHAT MAKES EVEN MORE SENSE --
Even (the smart) shorts agree that CF is a gold mine IF COULD FIND SOURCE OF CHEAP CAPITAL !!
Well – AAA borrowing … to 13-14% high risk lending is better than a gold mine(even if gold was $500/oz)
4. Also FROM TODAY'S WSJ, p.A3 :
"… AIG stock has risen 341% in the past 5 years…, market cap $209MM…"
Just what an acquirer needs – high priced "stock currency".
Again - I'm not saying it's more than a rumor (yet), but I'd not rush to dismiss A COMBINATION without looking into THE FACTS… after all most all bus. combinations began as "impossible rumors"…
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To: Tunica Albuginea who wrote (3007)
messages.yahoo.com
From: Kevin Podsiadlik Wednesday, Sep 20, 2000 1:40 AM ET
Reply # of 3036
<font color=whadda maroon>I have to hand it to you, Tuna, I honestly thought that that buyout rumor couldn't be made any loonier, but you have completely outdone yourself this time.
Let's see, say I'm on the board of AIG, and we just lost our top guy who was supposed to lead us for another decade or two. So now here's a bright idea, let's take on enough debt to drive our credit rating into the ground. <font color=yellow>Brilliant!
And from Wendt's point of view, I'm sure his job as Conseco CEO is so unchallenging that he'd jump at the chance to take on a whole new company's issues and in the meantime juggle a post-merger consolidation into his agenda.
__________
The above poster is apparently unaware that AIG is a several hundred billion dollar company.
And from a logical point of view, Mr. Wendt's being certainly one, it will render CNC's short term problem mute. As for managing AIG, that's more in line with the size of GE Finance. C'mon people, wake up. Financials call for size and conglomeration. Of course they'll be managed Wendt's style, in a conglomeration of expanding bubbles.
Frankly, Conseco although the eighth largest is too small. I've been calling for a Conseco merger since day one here. At the earliest opportunity I expect Mr. Wendt to negotiate a deal to merge Conseco into a larger entity.
by: dunnonuthin
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TA @Sept 20,2000, END of DAY CNC NEWS AND REVIEW
Message 14421110
SEPT. 20,2000 COMPLETE CNC REVIEW
Message 14421097 |
