Thursday, October 11, 2007

Going Private Transaction: CNFL

UPDATE:

CNFL has received an SEC Notice for having an insufficient number of public shares. They have until Oct. 24 to submit a plan to regain compliance. The company "believes that the proposed Going-private Transaction represents "good cause" for which Nasdaq Staff may extend the October 24, 2007 cure period."

In my opinion, this is a slight complication, but does not violate the original thesis. Even in the case where CNFL shares are delisted, that does not preclude the GPT.

ORIGINAL:

CNFL

SEC Filings

10/04/2007
07/19/2007

The company will execute a 1-for-250 reverse stock split in order to go private. Shareholders who own fractional shares will receive $7.25 per share, effective Nov. 13. If you can pick up shares today for $6.75 (last trade, I picked up my shares weeks ago at better prices), that should give you a 7% return within a one-month turnaround, for a 137% annualized return.

4 comments:

Derek said...

Thanks for the post.

So how many shares do you own? 249?

D Le said...

Yes, I own 249 shares that should be fully tendered for cash. Shares were recently available for $6.55, for an approximately 11% gain.

Anonymous said...

Hi,

It's November 14th and the going private transaction has completed. What do I do with my 249 shares? Thanks.

D Le said...

I just called my broker (Ameritrade) and they said the cash should be received within a week or two.