Friday, September 19, 2014

NII Holdings Notice of Delisting $NIHD

This is the end of the road for the equity:

On September 16, 2014, NII Holdings, Inc. (the “Company”) received a notice (the “Notice”) from the staff (the “Staff”) of The NASDAQ Stock Market LLC (“NASDAQ”) indicating that the Staff intends to delist the Company’s securities from The NASDAQ Stock Market. The Notice was issued in accordance with NASDAQ Listing Rules 5101, 5110(b) and IM-5101-1 and states that the Staff’s determination is based on the Company’s announcement that it had filed for protection under chapter 11 of the U.S. Bankruptcy Code and the associated public interest concerns raised by the filing, concerns regarding the residual equity interest of the existing listed securities holders, and concerns about the Company’s ability to sustain compliance with all requirements for continued listing on The NASDAQ Stock Market, including in particular Listing Rule 5450(a)(1), which requires a minimum bid price of $1 per share.

The Notice states that, unless the Company requests an appeal of the determination, trading of the Company’s common stock will be suspended at the opening of business on September 25, 2014 and a Form 25-NSE will be filed with the Securities and Exchange Commission, which will remove the Company’s securities from listing and registration on The NASDAQ Stock Market. The Company currently anticipates that any plan of reorganization implemented in the bankruptcy proceeding would provide that holders of claims and interests with respect to its equity securities, or rights to acquire its equity securities, would be entitled to no recovery and that those claims and interests would be canceled for no consideration. If that were to occur, all of the value of investments in the Company’s common stock will be lost. For this reason, the Company does not intend to take any further action to appeal the Staff’s decision.

Wednesday, September 17, 2014

The Broken Silver Parabola

I was right about the silver bubble.

Now looks like another very good risk reward for being short. The "support" at around $18 has been broken. My target to the downside would be and has been marginal cost of mining.

See the latest Pan American Silver investor presentations, for example. Based on the chart above, the production growth despite declining prices, and the mines' cash costs, $10 per ounce sounds about right.

Ackerman: "Strong Dollar Augurs Even Lower Rates"

"the recovery is so weak that even a small upward shift in rates would put the U.S. on the same recessionary track as Europe"

"Judge Approves NII's First-Day Bankruptcy Court Requests" $NIHD

WSJ

"NII said at the time that it would continue negotiating a restructuring with the bondholders up until the deadline, which was this week. Last week, NII announced those discussions hadn't produced an agreement on restructuring. The company has two main groups of creditors, one led by Aurelius Capital Management LP."

"Aurelius Supports NII’s Swift Emergence from Chapter 11" $NIHD

Press release from NIHD bondholder Aurelius

We have taken the lead among bondholders in supporting a plan that would allow the Company to emerge from Chapter 11 swiftly, by deferring until after emergence the resolution (through litigation or settlement) of many inter-creditor disputes. Aurelius was ready last week to enter into a binding agreement to support a plan (the “Reserve Plan”) that would have:
Converted all $4.35 billion of NII bonds into 100% of the reorganized company’s equity (before taking into account the rights offering mentioned below and any management incentive plan).
Allocated that equity among the bondholders in accordance with the absolute-priority rule.
Raised fresh equity through a rights offering. Aurelius offered to backstop $125 million of that rights offering.
Deferred all inter-creditor disputes until after NII emerges from Chapter 11. A portion of the new equity would be placed in reserve and released as each dispute is resolved, whether through litigation or settlement. (Any settlements reached before emergence would be taken into account in the initial distribution of shares at emergence.)

"For RadioShack, a History of Misses" $RSH

NYT

"The big box stores like Best Buy began to capture the bulk of the electronics business. RadioShack remained largely your local stop for electronics gear. The problem was that most of the equipment became cables and ancillary things to make the computers go.

Looking yet again for a new business model, RadioShack seized on mobile. But this merely made RadioShack a pawn in the cellphone wars as it tried to profit from selling a commodity."