IPO for the new name. Did we just get hosed?

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ddo2
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IPO for the new name. Did we just get hosed?

Post by ddo2 » Mon Mar 26, 2012 3:10 pm

Well, apparently the former Inland Western now Retail Properties of America has re-started their IPO in greater interest, having done the dividend of Class B shares and erasing most of the existing stock on a 10 to 1 reverse split. (note that the previous IPOs have done a 4 to 1, including the former I.W. proposed S-1. And best of all, they did this with the split first So, if I 'm reading this right, by way of example:

On day 0 I have 1000 shares (nominally worth $5,750) of Class A.
On day 0.5,I have 100 shares of Class A. (Presumably, they would now be worth 57.50 a share.)
On day 1, I also have 100 shares of Class B-1, B-2 and B-3 (worth nothing util 6, 12 or 18 months from the listing), but theoretically worth the same as the A.
So at the end of all this, I have 400 shares of stock. In theory, this is still worth $5,750, but each share would be worth $14.375.

Now, would I care that I have 400 pieces of paper worth $5,750 or if I had 1000 pieces? No.

But, they project an IPO price of $10-12. So, BEST case scenario is that I will have $4,800 worth of paper of which $1,200 is liquid. Yippee.

Someone correct me if I read this wrong. Here's a link to the SEC filing.

http://www.snl.com/Cache/1001164616.PDF?D=&O=PDF&IID=4087051&Y=&T=&FID=1001164616" onclick="window.open(this.href);return false;

ddo2
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Joined: Mon May 03, 2010 6:46 am

Re: IPO for the new name. Did we just get hosed?

Post by ddo2 » Mon Mar 26, 2012 3:56 pm

I should also point out that if the price is really $12 at IPO day, that put the pre split/dividend value of the old Class A stocks at about $4.80. Makes the secondary market seem even more accurate.

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REIT Wrecks
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Re: IPO for the new name. Did we just get hosed?

Post by REIT Wrecks » Mon Apr 02, 2012 8:10 pm

ddo2, your analysis is correct, it looks like pre-split equivalent share value will be $5-ish, depending on where it actually prices....

raleigh853
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Re: IPO for the new name. Did we just get hosed?

Post by raleigh853 » Sat Apr 07, 2012 10:38 am

I have worked in the financial services industry for 25 years and have recommended non-traded REITs to clients for the past 14 years. What has occurred with RPA (fka Inland Western)...10 to 1 reverse stock split/stock dividend sleight of hand, abusive internalization fees, etc. has convinced me to never again sell this type of product to any of my clients in the future. The shenanigans of Wall St. have found their way to Chicago where Inland is headquartered. I expected better from this company.

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