Egroup has applied for an S-4 filing dated 11/22/99 on the proposed merger to close at yearend, however the filing clearly states some troubling details. Namely that the Office of Thrift Supervision hasn't approved the merger and with a set date to close by yearend 1999 they would need OTS to move faster than it ever has in the past(which they admit is unlikely). Two thirds of TBFC stockholders must approve the merger. Also if the merger isn't completed, TBFC will pay Egroup $54 Million. Finally the merger may not qualify for a pooling of interest accounting method which would be disaterous. Last year, TBFC was at $150 and then started dropping. I bought in at $100 and even after a 2 for 1 split and the merger announcement the stack continued to plummet to the low 20's, I eventually sold for a tax loss in the low 30's, with a basis of 50. I believe that others may do the same to offset gains in other holdings. I will look to purchase on a steep decline after the 30 day waiting period. I hope I'm right. Any thoughts?
Sorry for the obvious ignorance, what is the 30 day waiting period all about?
Morgan 666, the 30-day waiting period:if you sell a stock at a loss, you can only take a capital gains loss on your taxes if you stay out of the stock for 30 days. Cantman99, thanks for the information. I hadn't seen that. I've been halfway hoping that the merger would fail, because TBFC's 3d Qtr statement looked great and EGRP was still sitting at 23. Of course, since then EGRP jumped into the high 30s, at least for awhileI still prefer TBFC on its own, but a $54 million charge doesn't look so great. Suspect you're right about the tax selling. Could be a rough month.
It doesn't look to me as though the merger will take place at all because of the Softbank issue. Stock dropped at close; my guess is it'll drop more today. Wish I'd sold when it was at $150.
vclem47, what's the Softbank issue? Wish I'd sold then too, but the netbanks were flying ...
There's a better discussion of this on the EGRP board.
I had read that the $54 million, that TBFC would have to pay EGRP would be if TBFC was bought by a third party, not if the EGRP-TBFC merger was not completed. Does anyone know for sure?
Best Of |
Favorites & Replies |
Start a New Board |
My Fool |