Mirant Corporation (MIR) Message Board

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Gold/Mining/Energy : Mirant Corporation (MIR)

MIR 27.45

-0.4%

Nov 7 9:30 AM EST

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To: Oeconomicus who wrote (741)	9/11/2002 9:19:27 AM
From: KyrosL	Read Replies (1) of 903

I think the main short term problem is the 10-Q delay and related accounting issues. The asset sales will not reduce earnings significantly, if $500 million of the proceeds are used to buy back debt at a discount. They key long term problem is the 2004 maturities which amount to $2.6 billion. If the credit squeeze does not ease by then, we may have a problem. Key to easing of the credit squeeze is the course of long term power pricing. The glut will last until 2004, but long term pricing should start responding to anticipated shortages before 2004. I have sold my preferred position and have replaced most of it with the common -- the process will complete this week. I think that at the present relative prices of low 20s for the preferred and low 3s for the common, the common is a better bargain than the preferred. Kyros PS. I have also bought Aquila common (ILA) and Aquila bonds (ILD). It has less potential than MIR, and its management is of lower quality, but it is safer IMO because it is asset rich, has relatively low debt, and has a large regulated utility base.

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