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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: E_K_S who wrote (40535)	12/17/2010 2:12:37 AM
From: Paul Senior	Read Replies (2) \| Respond to of 78676

XCO. I'm in now for the possible buyout. Stock at $19. Management buyout offer at $20.50. CEO has history of going private and he and "associates" control 40% of XCO. From the WSJ: "Mr. Miller, who is also Exco's chairman, has twice taken the companies he has headed private. In 2003 he led a buyout of Exco shareholders and took the company public again in 2006. Prior to that he took Coda Energy Inc., a Dallas oil and gas explorer, private. In his Nov. 1 letter to Exco's board, Mr. Miller said he had discussed the latest bid with private-equity firms Oaktree Capital Management LP and Ares Management LLC, as well as billionaire oil tycoon T. Boone Pickens, who is on the Exco board. Together Oaktree, Ares and Mr. Pickens owned more than 27% of shares, while Mr. Miller and his management team control 13%, according to FactSet Research. Mr. Miller owned more than 2% of Exco's stock at the end of the third quarter." And recently another billionaire makes his appearance AFTER the deal is proposed. According to the WSJ: "Billionaire turnaround investor Wilbur Ross has built up a 7.5% stake in Exco Resources Inc. nearly all of it since the Fort Worth company's chief executive announced he would try to take the natural-gas producer private." There are just too many deal makers and aggressive funds and billionaires heavily involved with XCO (by their 40+ % share holdings) not to have a deal get done. If it's for $20.5 and it's consummated in six months, that's %1.5/19 = 7.9% or about 16% annualized. If Mr. Ross is willing to come in at around 18.50 (my guess) for about 11% return (assuming it's done at $20.50 in six months), which might be 22% annualized, I'm willing to take 16% for what seems to me to be his affirmation of the close certainty of the deal: A deal will get done for at least $20.5. I see the bigger risk being the time frame, and my predicting inside of six months seems reasonable to me. Plus there's a possible upside too: Mr. Ross and/or the BOD may be able to get Mr. Miller and backers to up their offer.

To: E_K_S who wrote (40535)	1/13/2011 9:27:39 AM
From: E_K_S	Respond to of 78676

Re: EXCO Resources, Inc. Exco Resou(NYSE: XCO ) InPlay: Exco Resources announced it will explore strategic alternatives including a potential sale; will consider proposal received on October 29, 2010 to purchase all of EXCO's outstanding common shares for $20.50/shareBriefing.com(Thu 7:31AM EST) ------------------------------------------------------------------ Exco Seeks CEO Buyout Options, Adopts Shareholder Plan (Update1) noir.bloomberg.com I wonder if the CEO has the same incentive to seek shareholder value w/ his bid on the table. Some fair market estimates have valued the stock as high as $29.00/share. EKS