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Strategies & Market Trends : Value Investing

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To: Dale Baker who wrote (47174)	3/23/2012 5:35:19 PM
From: Jurgis Bekepuris	Read Replies (1) of 78670

Yes, it is. What is your point though? It is actually the most shareholder-friendly way of transferring cash from the sub to the parent, since all shareholders get the cash equally. I assume you (or shareholders) would be much more unhappy if SNDA would have bought out GAME with all its cash on the books at pre-dividend price. They could have done that quite legally you know since they have 96% voting power. How about the fact that SNDA still provides GAME with a number of professional services. They could have just hiked up the prices and gotten the cash from GAME this way. I'd guess you (shareholders) would be much less happy too. So overall, if you are complaining that they paid dividend to themselves, I really think that the complaint is rather silly and misplaced. Seems like GAME should be consolidated in SNDA's books already I'm not sure how this is important in anyway. There are tons of subs trading in markets. Whether they are consolidated on parent's books affects only parent accounting. It does not affect the sub in any way. Unless you mean something different than what you said. BTW, if you want to complain about SNDA's treatment of GAME, I wonder what you think about BRK's treatment of WSC. WSC was 90+% owned by BRK. WSC CEO Munger spent most of his time on BRK business. WSC money was always used by BRK the way they wanted. Remaining WSC shares were bought out at a price BRK suggested without any due process. Overall, I'd say the treatment of minority shareholders was quite horrible. And this happens when the parent is one of the most admired US companies... ;) Disclosure: I own large GAME position and small BRK position. I have owned SNDA and WSC in the past.

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