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MFS Charter Income Trust V.MCR


Primary Symbol: MCR

MFS Charter Income Trust (Fund) is a diversified closed-end management investment company. The Fund’s investment objective is to seek high current income, but also considers capital appreciation. The Fund primarily invests in debt instruments. The Fund also invests in corporate bonds of the United States and/or foreign issuers, United States government securities, foreign government securities, mortgage-backed securities and other securitized instruments of United States and/or foreign issuers, and/or debt instruments of issuers located in emerging market countries. It invests in a range of fixed income sectors, such as high yield corporates, emerging markets bonds, investment grade corporates, Non- United States government bonds, commercial mortgage-backed securities, mortgage-backed securities, collateralized debt obligations, municipal bonds, asset-backed securities and United States treasury securities. The Fund's investment advisor is Massachusetts Financial Services Company.


NYSE:MCR - Post by User

Post by Northforce13on Mar 16, 2022 5:09pm
204 Views
Post# 34519972

Possibly Fraudulent "Fairness Opinion"

Possibly Fraudulent "Fairness Opinion" The good, the bad... and the ugly


The good:  The offer is at a premium to recent SP

The bad:  The SP has always been depressed (half of peers) because the main share holder who controls the company doesn't care about minority share holders.  He is now making a lowball offer to these minority share holders because there are likely to be many great years ahead for the company with record revenues and earnings.  

The ugly:  The "fairness opinion" is total bullshit.  Much of it is predicated using an estimated calculation of 150 mil in revenues from 2023 and on, which is pretty much impossible, as opposed to using a reasonable assumption of what revenues would actually be.   Looking at page C-56, "Valuation Conclusion", we can see that this assumption is what largely influences the opinion.  If we substituted that number for a reasonable expectation of 2023 and beyond EV, we arrive at totally different numbers.  More like > 7.00.

My conclusion is that this fairness opinion is a total piece of garbage con job.  I believe that if minority share holders were to commission a "real" fairness opinion, it would not contain this clear and obvious scam estimate for revenues and EV for 2023 and beyond.

I don't mind being made a low ball offer.  I do mind being completely lied to, deceived and taken for an idiot.

Obviously, I voted no.  If I were an activist share holder, I would table a "competing offer", which would involve booting this guy out, or at the least demand the commissioning of another fairness offer, done by an entity commissioned by a group of the largest minority share holders. 

I do wonder a judge would consider this "fairness offer" somehow fraudulent a court of law.  


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