Chemtrade Logistics Income 6 50 Convertible Unsecured Subordinated Debentures T.CHE.DB.E

RE:RE:RE:Upcoming Whistler Conference, January 24th.

[Kherson]

Fantome wrote:

Kherson wrote:

Kherson wrote: I sure hope that Mark isn't planning on using the January Business Update that is on the Chemtrade website for his presentation in Whistler or else he will be laughed out of the room!
For the sake of not making fools out of yourselves at Whistler, would someone please correct the error on slide 17, that deals with the Balance Sheet, which gives a total equity of $1.8 Million to what I assume it should be, which is $1.8 Billion!
Funny thing here is that the clowns who used to run Canexus made these types of errors all the time!
Kherson
 

Posted on January 21st, 2018. It has been all downhill for Chemtrade since! The equity value is now around $900 million, but Davis is still getting his Incentive/Performance Bonus!
Kherson

Kherson...your post raises a number of questions and things tp discuss...

1....in the highlighted section (my highlights) the wording seems to imply that at that point you were a shareholder in CHE.....can you confirm this and if so when did you actually sell out your position?

2... your comment about Mark's wage package bears some discussion.  First it is not uncommon for CEOs to receive significant wages even though the stock price has gone down....I can't recall the specific and would need to look them up..but for example Jamie Dimon at Chase made millions in annual compensation during the financial crisis.

The issue of financial compensation is a thorny issue.  As I mentioned in an earlier post IMO Executive compensation over the past couple of decades has gone way out of wack and when i was working on the Street I was quite vocal about my views.

Tha being said it is difficult to come up with a scheme thast is fair to shareholders and also to the Executives and the need for companies to get the best people into senior positions.  In your post you talk about the msarket value for CHE falling to 900 million suggesting that this should be a determinant in the wage package....there are pros and cons to this and actually not that long ago it was a big factor in dtermining Ececutive compensation...the problem then became that Executives would take short term steps to increase the stock price to gain higher compensation at the expense of long term corporate goals.

Mark's reflect an attempt to balance these competing interest in determining his compensation.

Is it pefect?

No....but I would challenge anyone including you Kherson to come with a better idea that would balance the Executive compensation incentives with long term shareholder interests.

IMO while not perfect..The Board has come up with a formula that tries to balance these interests and have put thought into it.

3...the 900 nillion market value that you state in your post points to an interesting market dynamic...the market is essentially valuing the General Chemical acquisition at close to zero...this is not the first time I have seen this in my years investing and i doubt that it will be the last....usually when this happens we are at a nexus....either the acqusition was so bad that it destroys the combined company (which I believe is your opinion)...or....management shows that the acquisition was fine and the SP rebounds significantly....the later is my view with the caveat that it might take several quarters for management to prove itself once again

On that theme....if management doesn't prove itself in the next few quarterly reports I would be a seller of the stock... as i said in an earlier post...the price range for CHE going forward is 6-12..6 or so if the next Q reports are not good....around where it is no if the reports are OK but not great and closer to 12 if the reports show improvement.

Sorry for being so long winded....

Fantome, you posted this on July 3rd, 2019. 
Do you feel that management has proven itself yet, or do you still believe that the unit price will continue to drop down to 6 bucks?
Thanks.
Kherson