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Circuit City Finally Capitulates (CC, BBI, GS)

Circuit City Stores, Inc. (NYSE: CC) has finally capitulated.  There are two separate announcements this morning, but in reality it is all part of the same issue.  This will allow the company to deal with the activist pressure, and may ultimately lead to the company either being run by a better team or become a subsidiary of another company.

The company just issued a release that it has reached an agreement with Wattles Capital Management.

Circuit City will choose three board members proposed by Wattles, and now Wattles has agreed not to solicit proxies related to the 2008 annual meeting. In addition, two of Circuit City's current board members will step down by the annual meeting of 2009.

Circuit City has also announced that it has hired Goldman Sachs (NYSE: GS) in an effort to explore strategic alternatives to enhance shareholder value.  The company even agreed to allow Blockbuster Inc. (NYSE: BBI) and Carl Icahn to conduct due diligence related to its proposal to acquire the company.

Shares of Circuit City are up 11% at $5.35 in pre-market trading, and its 52-week trading range is $3.44 to $17.97.  Shareholders must be thinking, "It's about freakin' time."

You can join our open email distribution list to keep up with mergers, IPO's, spin-offs, and other specialty financings.

Jon C. Ogg
May 9, 2008

Jon Ogg is also a producer and editor of the "10 Stocks Under $10" weekly newsletter; he does not own securities in the companies he covers.

Circuit City's Largest Holder Joins Activist Efforts (CC, BBI)

A firm called HBK INVESTMENTS, L.P. has just changed its tune regarding its investment in Circuity City Stores Inc. (NYSE: CC).  As of December 31, 2007, HBK-I owned or controlled a combined 15,420,653 shares, which was list as 9.16% of the outstanding shares.  What is interesting is that this was said to be a passive stake.  Not any longer, according to their latest filing with the SEC that went to a 13D filing.  Here are some tidbits from the 13D filing:

• HBK Master originally acquired the shares of Common Stock for investment in the ordinary course of its business... believed, among other things, that the shares of Common Stock, when purchased, were undervalued and represented an attractive investment opportunity. The Reporting Persons have had, and expect to continue to have, discussions with management, other shareholders of the Issuer and other relevant parties (including Blockbuster) concerning the business, operations, management, governance, strategy and future plans of the Issuer.

This also notes that on April 28, 2008, HBK Capital Management sent a letter to Circuit City encouraging it to allow Blockbuster to perform due diligence in connection with its merger proposal and to commence good faith negotiations with Blockbuster regarding its proposal.  HBK Capital Management also has urged the board of directors of Circuit City to create a competitive bidding process in order to maximize shareholder value.

Shares of Circuity City are at $4.62, down 1.5% today.  Wattles was a small fish in comparison, but it looks like they have garnered more activist support now.   According to our data, HBK is also Circuit City's largest shareholder.  Blockbuster Inc. (NYSE: BBI) shares are also down by about 1.3% today.

You can join our open email distribution list to hear about previews for other mergers, spin-offs, break-ups, IPO's, special financings, and other special situations.

Jon C. Ogg
April 28, 2008

ValueAct Going After Chimera? (CIM, NLY)

ValueAct Capital Management is a leading activist fund that acquires shares in public companies to influence their boards to make certain actions or to fix current problems.  In an SEC Filing, the fund (through multiple entities) has just disclosed that now holds over 2.51 million shares, or some 6.7% of Chimera Investment Corp. (NYSE: CIM).  As of December 31, 2007, ValueAct had a 1 million share stake for some 2.65% of the shares outstanding.

For those of you who don't know Chimera, this is the one we praised for being the first mortgage vulture to file seperately to come public last year.  That worked incredibly well, for a while.  Then the woes started spreading there as no one was immune.  The fact that Annaly Capital Management, Inc. (NYSE: NLY) was sponsor and much of the team was the same only gave it more credibility.

But Chimera, after almost seeing $20.00 has slid to a low of $10.59 and shares closed at $12.24 today.  It has been punished.

In the filing, it notes, "...changes in the Issuer's operations, business strategy or prospects, or from sale or merger of the Issuer.  To evaluate such alternatives, the Reporting Persons will routinely monitor the Issuer's operations, prospects, business development, management, competitive and strategic matters, capital structure, and prevailing market conditions, as well as alternative investment opportunities, liquidity requirements of the Reporting Persons and other investment considerations. "

These purchases were made from March 11 to April 23 at prices of $11.76 to $12.99.  Chimera closed up 3.6% at $12.24 today and shares have not reacted in after-hours trading.

You can join our open email distribution list to hear about other activist investor activities, restructurings, spin-offs, IPO's, special financings, and more special situation previews.

Jon C. Ogg
April 24, 2008

Wendy's Craters to Peltz, Triarc, Trian... Over The Barrel (WEN, TRY, TUX)

Triarc Companies, Inc. (NYSE: TRY) and Wendy's International, Inc. (NYSE: WEN) have signed a definitive merger agreement.  According to the release, this has been approved by the
boards of directors of both companies.

The merger appears to be an all-stock buyout entitling Wendy's shareholders to receive a fixed ratio of 4.25 shares of Triarc Class A Common Stock for each share of Wendy's common stock they own.  Before Triarc dilution, that looks like a price of $26.775 based on Wednesday's close.

We did just predict in our Special Situation Investing Newsletter (trials can now see that report) on Monday night that Wendy's would crater and either go proactive under Peltz's activism or that it would finally crater to a buyout.  But we predicted that Peltz & Friends would have to come up with $30.00 per share in order to execute a friendly merger or at least one that isn't quite so hostile.  While we are disappointed with this transaction, this is a stock for stock merger that does at least allow upside if the combined operations can reach the synergies, savings, and growth that it wants to achieve.

It does not appear that Trian Acquisition I Corp. (AMEX: TUX), the Peltz SPAC, is part of this deal other than that the Trian Partners sponsor will vote in favor of the merger along with Peltz and others (who own roughly 35% of Triarc).  That SPAC involvement may change if this deal needs a kick-up, but that is just for pondering rather than anything certain. 

Activists Come Knocking Harder At Wendy's Doors (WEN, TRY)

An SEC Filing this morning shows activists are going to go after Wendy's International Inc. (NYSE: WEN) with a little more publicity than mere private letters.  Trian Fund Management, L.P., Triarc Companies, Inc. (NYSE: TRY) Peter May, Nelson Peltz, Thomas Sandell, and others are in an activist group that have sent a letter to Wendy's International, Inc. (NYSE: WEN).

Trian appears to be the lead in the group as far as signing the letter, and the letter says it is very concerned about the current direction of Wendy's. Trian and Triarc were informed that the Wendy's special committee had rejected two acquisition proposals made by Trian and Triarc, which had called for the combination of Wendy's and Arby's and the other involved an acquisition of 100% of Wendy's for over $900 million in cash with the balance in stock.

These proposals would have required the approval of the shareholders on each side of the transaction and neither of the proposals was conditioned on the receipt of third party financing. The letter notes that the most recent proposals were summarily rejected in less than 24 hours.

Before any transaction is considered, shareholders should be fully updated on the current financial condition of the company, including sales, profits and margins. The activist group also expects that the company will not take any action prior to the earnings announcement on April 25.

Trian wants shareholders to determine the future of Wendy's and it intends to contact other shareholders to call a special meeting to give shareholders the opportunity to vote on the future direction of Wendy's.

This is looking like it is a very unique special situation.  The problem is that the value has been previously hard to see in Wendy's and it would not have been exactly cheap for an acquirer.  But this pullback down to the mid-$20's may actually change this now that its ratios have come in-line or under many of the peers. 

We checked Capital IQ's database and the company isn't an easy one to push around, although it isn't exactly one that can lock the doors and pray for the best while the world burns.  It requires a 67% vote by the board to approve any transaction, and 75% of shareholders are need to approve any transaction without board approval.  The board is considered a classified board, and it does have cumulative voting for board seats.  Its 15 member board also has 3-year terms.  The provisions do allow for shareholders to act by written consent, so this letter at least has to be acknowledged. Capital IQ also notes that Wendy's does have an active poison pill.  Lastly, Ohio is that the state of incorporation, and that state is one of the harder ones for hostile mergers or actions against public companies incorporated there.

You can join our open email distribution list to hear about other activist situations, IPO's, back door plays into IPO's, spin-offs. break-ups, and other special situations we frequently preview.  We have reviewed this one in months past for the Special Situations newsletter, but the valuations at the time appeared to be a serious obstacle.  Now that it has come in, it looks like it may be time to dust off those notes and see if the relative value is there.

Wendy's shares were basically unchanged pre-market after closing at $25.10 yesterday, but shares are now up almost 1% at $25.34 right after the open.  The 52-week trading range is $22.18 to $42.22.  Its current market cap is just shy of $2.2 Billion.

Jon C. Ogg
April 18, 2008

Jon Ogg is a producer and editor of the Special Situation newsletter and the "10 Stocks Under $10" weekly newsletter for 247Wallst.com.

JANA Stays After CNET (CNET)

JANA Partners LLC has released a detailed white paper analysis of CNET Networks Inc. (NASDAQ: CNET).  As you can guess, the activist investor group is rather disappointed with CNET.  The groups that JANA has added into its shareholder group hold approximately 14.9% of the voting power in the stock, and JANA's stake is 5% of the total.

They argue that stopping the destruction of shareholder value at CNET will require fundamental strategic and operational change.  Jana notes that implementing this change will require the type of experience and expertise it believes the Board nominees the group has proposed would add to CNET's Board of Directors. 

JANA has noted that the performance of the current board of directors has presided over the loss of more than half of CNET's market value since a majority of current directors have been in place.  CNET's shares declined by -21%, -52%, and -25% in the one, two and three year periods ended March 28, 2008.  It also wants the board to explain why shareholders would not benefit from Jana's proposed changes.

JANA addresses its rejection of CNET's offer of one of the seven board seats the group is seeking.  It feels this would not bring the level of change needed at CNET.  There are many other criticisms.  CNET has failed to turn these assets into shareholder value and its own review was only initiated after outside pressure mounted. CNET has not taken necessary changes to protect the value of its strongest assets, instead expanding into new verticals. CNET needs comprehensive strategic and operational change to strengthen its core businesses and adapting to the modern Internet.  The group wants new leadership to create significant new value for shareholders.

JANA has joined with Sandell Asset Management Corp., Paul Gardi of Alex Interactive Media, Spark Capital and Velocity Interactive Group in seeking to elect two individuals to replace the board members who are up
for re-election and to expand CNET's board by five members and nominate individuals to fill those vacancies.

We frequently discuss restructurings, activist investor trends, IPO's, back door plays into IPO's, SPAC's, spin-offs, and more on our open email distribution list.  We also just covered CNET on our weekly "10 Stocks Under $10" subscriber letter yesterday.  We aren't quite as optimistic on the instant value creation, but JANA's approach is one of long-term changes rather than short-term shareholder rewards at the expense of the long-haul.

More detailed information can be found on this particular situation at www.JANAGroupInfo.com.

Jon C. Ogg
April 1, 2008

Jon Ogg produces the Special Situation Investing Newsletter and he can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

H&R Block Chairman Aggressively Acquires Shares (HRB)

Richard Breeden has disclosed in an SEC Filing that he has aggressively bought shares of H&R Block (NYSE: HRB) this week. From the dates of March 18 to March 20, Breeden purchased roughly 2.435 million shares at various prices of $18.84 to $20.76.  Prior to this SEC Filing, Breeden and his affiliated entities owned 6 million shares of common stock.  The direct reported holdings are now carried as 8.435 million shares.

Richard C. Breeden was elected a director of H&R Block in September 2007 and was then elected as Chairman of the board in November 2007.  He is also a former chairman of the Securities and Exchange Commission, which is a highly noted position for a public company.  He is the managing member of Breeden Capital Partners LLC, managing member and Chairman & CEO of Breeden Capital Management LLC and the Key Principal of Breeden Partners (Cayman) Ltd.  Breeden Capital Partners LLC is in turn the general partner of Breeden Partners L.P. and Breeden Partners (California) L.P.  Due to SEC rules he is deemed to be the beneficial owner of all of the common stock owned by these entities.  These entities have been an active investor in H&R Block.

On March 17, 2008, H&R Block announced that it was selling its OPTION ONE mortgage servicing business to Wilbur Ross, and the company already got earnings behind it earlier this month.  This was the stock that Jim Cramer recently featured as his stock play to win on taxes this year because of Breeden's involvement and because of selling Option One.  Shares are up 1.3% today at $20.59 and have traded as high as $20.94.  The 52-week trading range for the last year has been $16.89 to $24.02, but shares have also traded as high as $30.00 over the last five years.

Jon C. Ogg
March 20, 2008

Icahn Takes Larger Stake in Enzon (ENZN, IEP)

In an SEC Filing, it was disclosed that Carl Icahn has taken a larger stake as an activist in Enzon Pharmaceuticals Inc. (NASDAQ: ENZN).  The stake is listed as 6.93% for just over 3.07 million shares. 

Icahn Capital was already a holder as of last year.  Icahn is suggesting disappointment over the price of the company and he has suggested strategic alternatives including a sale of the company.  The group has held talks with management and plans to seek further discussions.

Enzon shares were in negative territory for the day, but now shares are up almost 5% at $8.90.  The 52-week trading range is $6.31 to $10.36.

This is via entities such as High River Limited Partnership, Hopper Investments LLC, Barberry Corp., Icahn Partners Master Fund LP, Icahn Partners Master Fund II LP, Icahn Partners Master Fund III LP, Icahn Offshore LP, Icahn Partners LP, Icahn Onshore LP, Icahn Capital LP, IPH GP LLC, Icahn Enterprises Holdings L.P. (NYSE: IEP), Icahn Enterprises G.P. Inc., Beckton Corp., and Carl C. Icahn himself.

Jon C. Ogg
March 14, 2008

This week on Stockhouse February 19 – 22

The TSX and the Dow parted ways this week as commodities lifted Canadian markets.

Gold, platinum, silver, copper, oil and soft commodities led gains across the TSX and the TSX Venture exchange, though the Dow was not so lucky. Poor economic data and mixed earnings news and guidance, along with continued turbulence in the bond rating and bond insurance markets, offered no support for the U.S. index

MMI Pushes Another (UIS, BCO)

Shares of Unisys Corp. (NYSE: UIS) are trading up 8% today after capitulating to activist investor MMI Investments, LLP, which is one of the largest shareholders of Unisys.  Unisys has delayed its annual meeting to July 24 to allow it more time to "explore certain portfolio rationalization and other actions that may enhance shareholder value" with its investment banker Bear Stearns.

If this sounds familiar at 247WallSt.com, it is because this was listed as one of "turnarounds that hasn't turned around" recently.  In the we noted: "When you backdate the news and look at the history of the company you'd think that the turn may have already started.  But shares are barely above 52-week lows and are barely off of multi-year lows too."

MMI was one of the reasons we named Brinks (NYSE: BCO) to our Special Situations newsletter, and is also part of the reason we have not wanted to close out that position to lock in would-be profits.   You can look at their last proxy filing to see how involved MMI can get.

MMI sent a shareholder letter in early January to urge its review of alternatives, and part of that encouragement included its government services business.  We are not actually under the belief that a mega-premium buyout is in the cards for Unisys.  We are not overly encouraged by an already-leveraged balance sheet that is too heavy in goodwill and intangible assets.  But we do believe that the company can continue to make cuts as needed and can streamline certain operations that are not contributing to the bottom line.  The company is still underperforming compared to analyst estimates, but it has at least come back to 'quarterly profitability' and that is at least a start.

Those of you who trade turnarounds will want to keep this one on your watch lists.  It may be a long slow road, but it looks like the car is at least out of the shop even if it isn't on the road yet.

Jon C. Ogg
February 19, 2008

Icahn's Top Holdings (APC, BEAS, BIIB, CSX, LEA, M, MOT, JCP, REGN, TIN, TWX, TWC, UNM, WMB)

Billionaire activist investor and financier Carl Icahn has released the total holdings in an SEC filing for the period end December 31, 2007 for  ICAHN CAPITAL, LP.

As Carl Icahn and his friends are multi-billionaires, we have eliminated the positions under $50 million since smaller postions are hardly worth his time and effort. The left column is the dollar amounts and the second number is the number of shares:

• ANADARKO PETROLEUM (NYSE: APC) $970,600,000  14,775,468 shares
• BEA SYSTEMS (NASDAQ: BEAS)  $654,176,000; 41,456,016 shares
• BIOGEN IDEC (NASDAQ: BIIB)  $469,973,000; 8,256,723 shares
• CSX CORP (NYSE: CSX) $128,422,000; 2,920,000
• LEAR CORP (NYSE: LEA) 265,424,000; 9,595,954 shares
• MACYS (NYSE: M)  $133,610,000; 5,164,660 shares
• MOTOROLA (NYSE: MOT) $969,881,000; 60,466,400 shares
• J.C.PENNEY (NYSE: JCP)  $183,274,000; 4,166,271 shares
• REGENERON PHARMA (NASDAQ: REGN)  $60,568,000; 2,508,001 shares
• TEMPLE INLAND (NYSE: TIN) $71,901,000; 3,448,488 shares
• TIME WARNER CABLE (NYSE: TWC) $130,027,000; 4,711,128 shares
• TIME WARNER INC (NYSE: TWX) $213,526,000; 12,933,159
• UNUM GROUP (NYSE: UNM) $95,659,000; 4,020,960 shares
• WILLIAMS COS INC (NYSE: WMB)  $173,201,000; 4,840,724 shares

Jon C. Ogg
February 14, 2008

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in any of the companies he covers.  Join the 24/7 Wall St. open email distribution list to hear of spin-offs, emerging IPO, break-up, reorganization, and other special situation stocks.

Motorola's Best Strategy: Getting Icahn To Buy More (MOT)

Carl Icahn has disclosed in an 13D SEC FILING that he boosted his share ownership in Motorola Inc. (NYSE: MOT).  Icahn indicated his ownership of the stake in a notice to nominate four directors to the board sent last week, and he noted that shares are undervalued and that he intends to seek further conversations with the company.  It appears that Icahn now holds some 114.2891 Million shares of Motorola stock, which is now roughly 5% of the common stock.

Icahn is a very smart and influential investor.  But it may take more than forcing a share buyback and a cell phone business auction to make this stock turn around.  That is why we listed this as one of the top stocks that may disappear this year.

Motorola shares are up about 1% to $11.60 in after-hours trading, which is actually more than 20% higher than the 52-week lows of $9.43 seen recently.  Frankly, if John Chambers & Co. wasn't such a better competitor and if they hadn't guided lower on tonight's Cisco conference call these shares might be up more than this.

Jon C. Ogg
February 6, 2008

Carl Icahn Buying Into J.C.Penney? (JCP)

The WSJ has reported that Carl Icahn has been amassing a stake in J.C.Penney Co. (NYSE: JCP).  Unfortunately, the WSJ is citing "people familiar with the matter."  Those people are not always clear and not always perfect, although we'd be under the opinion that the WSJ wouldn't have run this based solely on "people" if it hadn't gotten confirmation from unrelated sources that may know. 

We don't know the size of the stake taken if this really occurred, although one noted that the holding may be on of the larger holdings.  As J.C.Penney has a $10+ Billion market cap, there is a lot of stock that could be acquired.

We'll probably get to find out if this is real or if this isn't tonight, because Carl Icahn is scheduled to appear briefly on CNBC's FAST MONEY at 5:00 PM EST. 

So far J.C.Penney shares are up a bit over 1% at $48.00, although the stock has traded as high as $49.14 today.  The 52-week trading range is $33.27 to $87.18.  While many retail stocks were punished hard, JCP shares are actually up so far in 2008.

CEO Ullman is one of Jim Cramer's favorite CEO's as well so we'd expect Cramer to be discussing this tonight on CNBC's MAD MONEY as this is a retail stock and within his current trends.

Jon C. Ogg
February 1, 2008

Brinks: The Sweet Spot In A Rough Patch (BCO)

Shares of Brinks Co. (NYSE: BCO) are up significantly after today earnings report.  We have been behind Brinks for several months now, and it is still an active stock on our Special Situation subscriber letter.  This has approached our own $70 price target before the market malaise took it lower.  It actually never even did hit our downside panic levels, but we have a hedged scenario anyhow.

This morning Brinks managed to beat earnings quite handily.  Brinks posted earnings at $1.16 EPS, well above the $0.74 estimate from First Call; revenues were up more than 18% to $882.8 million, yet First Call only had estimates at $819.5 million.

Furthermore the company put 2008 goals for organic growth of high-single digits for revenues with operating profit margins at or above 8%.  Not only that, but Brinks is looking further out to 2010 with a goal of sustaining that rate of revenue growth and boosting its operating margins to 10%.

Our Special Situation thrust here was only partially based upon improving results, although we did expect a turn there again.  We have been tracking increased activist investor activity and after we reviewed the books, the business stance, its minor units that could be parceled out, and other factors, we determined that this stock could reach roughly $70.00.  Our entry area was in the mid-$50's in September 2007, and we didn't want to note the profits by taking them too soon in the mid-$60's by early November.

As always, we laid out an options trade that allowed for hedging the transaction to minimize risk.  This is crucial for many turnarounds and for many businesses that have special situations they are working through.  In short, it's important to have protection when management may intentionally or inadvertently take actions that result in negative shareholder value.

Jon C. Ogg
January 31, 2008

Hedge Fund Holder Says Countrywide Selling Too Cheap (CFC, BAC)

A hedge fund is claiming that Countrywide Financial (NYSE: CFC) is selling itself too cheaply to Bank of America (NYSE: BAC).  SRM GLOBAL FUND GENERAL PARTNER LIMITED has filed a Schedule 13D.  SRM now owns and has a shared voting power of just over 30 million shares, or 5.19% of the common stock.  We would at least note that the "as of date" is January 24, 2008, even though the filing posted on Edgar at 8:33 this morning.

Here are excerpts from the comments from SRM: "...the Reporting Persons are of the view that the Merger Agreement does not provide sufficient value to holders of the Issuer’s Common Stock. The Reporting Persons may initiate discussions with the Issuer and may communicate with the Issuer’s executive management and board of directors, with other holders of the Issuer’s Common Stock, and with B of A from time to time regarding the proposed terms of the Merger Agreement. Depending on various factors.... the Reporting Persons may in the future take such actions with respect to their investment in the Issuer......."

In short, SRM is saying that Countrywide is selling itself too cheaply, and SRM is trying to demand a higher price or will try to influence a vote against the approval of this merger.  SRM probably has a long road in front of them here on this effort as Countrywide was going to be an "at risk" company without this buyout. 

Jon C. Ogg
January 31, 2008

Hank Greenberg & AIG, Up A Rope & In The Wind (AIG)

Former head and oustered Maurice "Hank" Greenberg according to an SEC filing is leading a campaign to do a total makeover at his AIG (NYSE:AIG).  There is a problem besides the fact that Greenberg is 82 years old.  He was ousted in 2005 after Eliot Spitzer's pre-Governorship probe of the industry that led to his demise as leader there. A key consideration is that Greenberg may in fact be blocked from being able to do very much on his own.  Here is the summary of the filing:

The Reporting Persons are considering and evaluating strategic alternatives designed to lead to the maximization of their investment in the Issuer.  The Reporting Persons believe that there are opportunities to significantly improve the Issuer's performance and strategic direction, as well as the value of their investment.  In this connection, the Reporting Persons anticipate holding discussions with stockholders and third parties that may address a number of issues, including without limitation, their respective views on the Issuer's business and prospects, the suggested disposition of certain of its operations, investment opportunities and concerns over the direction and management of the Issuer generally, and other opportunities to improve or realize on the value of their investment in the Issuer.  At this time, the Reporting Persons have not made any decisions regarding their future intentions with regards to their plans and proposals with respect to the Issuer.

The Reporting Persons reserve the right to change their plans and intentions, including the right to increase or decrease their investment in the Issuer.  In particular, any one or more of the Reporting Persons may (i) purchase additional shares of Common Stock, (ii) sell or transfer shares of Common Stock in public or private transactions (including, without limitation, transfers among Reporting Persons or between any Reporting Person and any entity affiliated with such Reporting Person, which may include entities not in existence as of the date hereof), (iii) enter into privately negotiated derivative transactions and/or public purchases and sales of puts, calls and other derivative securities to hedge the market risk of some or all of their positions in the Common Stock and/or (iv) take any other action that might relate to or result in any of the actions set forth in response to paragraphs (a) - (j) of Item 4 of Schedule 13D................

Unfortunately, this will be a tough one for Mr. Greenberg, despite his approximate 13% ownership.  He may have been unjustly run out of his own company, but the path was already set some time ago.  Many people refer to behemoth companies as battleships that take a long time to turn.  It is hard to imagine that this can be affected immediately, but 24/7 Wall St. will run the math on it.  It is obvious thatthe new management team is not a strong one, at least not compared to when Greenberg was commander in chief of the financial and insurance conglomerate.

AIG traded up over 3.5% to $61.25 in after-hours trading on Friday.  The 52-week trading range is $56.37 to $72.97.  This will create one hell of a Special Situation newsletter report if we get to look at AIG as a break-up or activist candidate. 

One key issue Mr. Greenberg will have to consider is a good old cowboy euphemism: "Once you let the cat out of the bag, it's hard to put it back in."  Shining light on the hidden financial woes internally may also create some temporary harm to the stock.

Jon C. Ogg
November 2, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he produces the 24/7 Wall St. subscriber-based Special Situation Investing Newsletter.