RE:Dumb A$$es still talking about this failure. This could rapidly become a circular discussion and this tax pools question remains, at this point, theoretical.
But let’s talk. Just in case. And for the future.
-"I don't think it is worth my time to make any presentation to the court or Receiver for the value of the tax pools, the matter speaks for itself! "
I have a problem with that. In all due respect, I am not convinced. Perhaps others (key players) won’t be either.
One key topic is the cost of financial distress. The cost can be very real. If you take a mortgage and then do not respect the basic aspects of your side of the contract, you risk losing your financial sovereignty AND your ownership of the mortgage-financed asset.I submit that saying things will eventually get better or that the matter speaks for itself may not be enough.
TBE was clearly in distress. Dire circumstances. This is not business as usual. You have to take into account the potential cost of distress. The shares may continue to show value on the markets but it becomes a speculative (?gambling) call option. You have to come up with a realistic value for the enterprise. Perhaps you have to be comfortable with these concepts. The key inputs then are that debt has a prioritized face value and debt can become equity. It may become a matter of capital priority.
TBE has been on sale for months and months, and the best value that has resurfaced has not, so far, met the baseline of total debt and interest due. Food for thought. From public disclosures and media articles (Google can be a good financial tool), the buyer may be related to Sinoenergy. I would say then that the best price has been obtained under the distress circumstances.
If interested, I include a link that may be useful for future endeavors. You don’t need the detailed math but material principles of the cost of financial distress are well delineated. Esp. P.37-49
https://people.stern.nyu.edu/adamodar/pdfiles/papers/distresspaper.pdf Perhaps, if we come to a real discussion about the tax pools, we may have to go back to those material principles.
Bojangle,
For many reasons (including the tax pools), I too « couldn't understand why reignwood didn't come back with a better offer for the debenture holders ». To this day, this question still haunts me. I will do well on this investment and will eventually forget but.