Bruce --
You're not gonna get away with that one!
To date, I've been a lurker on SI.
Your most recent post has prodded me out of my slumber.
You wrote:
<< For a very good example of exactly what Dr. Zeev is referring to, go to the CTYS thread. Also, do a one year chart on CTYS and see what their $500MM Preferred issue (among other things) did to the stock. >>
I have only scratched the surface of the CTYS case and it seems clear to me that the company's problems have precious little to do with its financings.
CTYS appears to have been a reasonable convincing bullish story. I never followed the story myself, but I assume it was convincing because Michael Price was an investor. It appears, however, that the story was something of a fabrication.
The following in an excerpt from a public announcement of a class action against the company:
<< The complaint charges that Cityscape and certain officers and
directors of the company during the relevant time period violated
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, by,
among other things, misrepresenting the fact that the company was
engaging in improper loan and accounting practices. The complaint
alleges that throughout the Class Period, the defendants misled
investors with regard to Cityscape's loan practices in the United
Kingdom and the negative effect such practices would ultimately have
on the company's revenues and profits. When the company revealed
the changes it would have to make in its loan practices due to
regulatory initiatives in the United Kingdom, and the resulting
impact this would have on profitability, the stock dropped
precipitously. >>
Based on this information, I don't think preferred debt had anything to do with this company's problems. At worst, the preferred may have hastened a well-deserved death.
Tell me, please, what have I missed?
And what on earth does the case of CTYS have to with HEC?
Joe |
