From the transcript
"It is responsible tax planning to offset significant capital gains with capital losses. So Thermo publicly announced, in connection with the October financing, that it was likely to sell these high-basis shares before the end of the year and made explicit disclosures about this in Globalstar's SEC filings and directly with investors concurrent with the Morgan Stanley October financing, months before the December sale. "
Well, I am all for responsible tax planning Jay.. however, you have had to offset significant capital gains before.. Back at the end of 2014. You had the same issue.. But, instead of selling the Globalstar stock to the open market.. You sold the Globalstar stock from one division of Thermo to another division of Thermo.. So you were able to satisfy your needs to execute responsible tax planning without sending a message to the market that you were willing to sell shares of Globasltar at what was seen as a "depressed price" at the time.
You remember.. Like this..
sec.gov
"Globalstar, Inc. announced that on December 19, 2014, Thermo Investments II, LLC (“TI”) acquired 12,371,136 shares of Globalstar voting common stock (the “Shares”) from Thermo Funding II, LLC (“TF”) at $2.82 per share in a privately negotiated transaction. After the transaction, TF and its affiliates retain approximately 770,000,000 aggregate voting and nonvoting shares of Globalstar on a fully diluted basis. James Lynch and the James Monroe III Grantor Trust are the members of TI and TF, respectively. The transaction by TF was solely for tax planning purposes relating to taxable gains recognized by TF on the acquisition of tw telecom inc. (“TWTC”) by Level 3 Communications, Inc. (“LVLT”).
The Shares originally were acquired by an affiliate of TF in 2006 and 2007 pursuant to a stock purchase agreement whereby the affiliate purchased $200 million, or 12,371,136 shares, of Globalstar voting common stock at $16.17 per share that it subsequently contributed to TF.
TF’s loss on the sale of the Shares offsets a portion of the taxable gain realized by TF and its affiliates from the acquisition of TWTC by LVLT. The investment in TWTC originated from a 2006 sale to TWTC of a majority ownership by a TF affiliate of Xspedius Communications, a long-haul and metro fiber telecommunications network provider.
" |
