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Strategies & Market Trends : Bosco & Crossy's stock picks,talk area -- Ignore unavailable to you. Want to Upgrade?

To: Crossy who wrote (3337)	5/5/2003 4:10:10 PM
From: JoeinIowa	Respond to of 37387

Crossy, Congrats. MHCA showing some signs of life also for you. Joe

To: Crossy who wrote (3337)	5/6/2003 10:37:16 PM
From: Crossy	Read Replies (1) \| Respond to of 37387

re: KASPQ (Kasper ASL) There's an odd situation on the market but it's quite high risk - Kasper ASL ? They own Anne Klein for example. The co. is in Chapter 11 and still owes $145m to creditors. However this year they generated $70m in free cash flow. CEO John Idol succesfully turned around DK (Donna Karan) and later sold out that firm to LVMH. He teamed up with Partheon capital to acquire the company for HIMSELF out of bankruptcy satisfying the creditors in full while giving old common holders nothing. However this may not work because 3 Hedge funds have been buying rather big positions in this company recently (among them Lone Star Partners, they have also been involved in IPSU) took sizeable positions, each around 10%. A proxy fight might be coming up. If you apply a DCF, you could see the company being worth north of $20 for the old common. The problem is you need a buyer who is willing to pay $300m for Anne Klein. I calculated around $60-70m free cashflow for 2003 (until the NOLs are eaten up) and around $40-50 thereafter to arrive at an enterprise value of $24 per share after you paid the $140m in liabilities. Antoher option would be to look for a new lender - actually the 10K looks like they might already have found one (the DIP fincnancing is not used at all) and satisfy the creditors with this - and exiting ch11 gracefully. This might be a rare case study where a company might exit Ch11 without diluting the old common... Hmmm... today the company again warned shareholders that KASPQ might be worthless. Stock plunged from $4 to $3 at the open only to recover towards $4 again near the end.. rgrds CROSSY