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Real-Money Stock Picks / Jim Royal


Subject:  Re: NRE Date:  6/17/2019  11:27 PM
Author:  XMFRoyal Number:  4660 of 4999

Don't I know it?!

It just keeps sliding over the past few weeks. I'm at a bit of a loss as to why, but maybe there's some knowledge leaking out that a deal is off. I'm still holding on to my stock, however.

I will just remind people of what happened at BOBE, after it sold its restaurant unit and paid out a special dividend. It foundered and fell for weeks as the shot-in-the-arm special dividend wore off and the prospects for a buyout seemed to be lower. But recall this is when the company was even more svelte, reduced to its best unit -- the packaged goods group -- which was growing nicely. In BOBE's case, it was merely rumors that there would be a sale, given that Sandell was getting what he asked for.

In the case of NRE, we have a stated intent to sell the company. And seemingly we have a backstop in CLNY. Mr Market gets bored when there's no action for a while, but often that's a good point to remember and focus on the thesis. We have two weeks until the extended deadline passes, and no word from the company since late April. Apparently there were two bidders who were interested in the property. It will be interesting to read the behind-the-scenes details on this if they're ever filed. That's some of the juiciest (SEC) reading out there.

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