(Source: MARKETWIRE)
Southern Strategic Partners, L.P. ("SSP"), a significant preferred
stockholder of Newcastle Investment Corp. ("Newcastle") (NYSE: NCT)
(NYSE: NCT.PrB) (NYSE: NCT.PrC) (NYSE: NCT.PrD), today announced it
believes Newcastle's proposed tender offer and amendments to the
rights of Newcastle's preferred stock are inadequate and unfair. SSP
principal Hugh Entrekin said that SSP does not at this time plan to
vote for the amendment or to tender its shares. Mr. Entrekin
commented, "While we could be supportive of a restructuring of
Newcastle, we cannot support the current proposal because it fails to
recognize the preferred stock's priority position in the capital
structure and does not offer preferred stockholders common stock or
warrants to purchase common stock as part of the tender." SSP (along
with its affiliates) owns almost 7% of the Series B preferred shares
outstanding and over 8% of the Series D preferred shares outstanding.
Newcastle is proposing a tender offer price of $6.76-7.19 per share
for each of its series B, C and D preferred stock. Mr. Entrekin
explained, "The offered price per share represents too large a
discount given the Company's greatly improved liquidity position and
cash flows."
SSP believes that Newcastle's proposal, if approved, would gut the
preferred stock terms and by deregistering the preferred stock from
the current listings on the New York Stock Exchange, the non-tendered
preferred shares would be essentially worthless. Mr. Entrekin
commented, "The proposed tender is at a grossly inadequate price and
fails to recognize the superior position of the preferred shares
relative to the common shares." SSP believes that the proposed
exchange offer and amendments are grossly inadequate and potentially
coercive and that preferred stockholders would be giving up too much
potential value by accepting the offer.
Mr. Entrekin concluded, "We cannot support the current proposal as
the price is inadequate. In addition, the proposal also does not allow
the preferred stockholders to exchange their shares for common stock
at a meaningful, and significantly higher, price. Lastly, the current
offer does not include any change in management's compensation to
reflect the company's reduced capital position or provide new
incentives to management tied to operating cash flows, dividends and
common share price with payment to be made in the form of common
shares or options."
Contact:
Southern Strategic Partners, L.P.
Hugh Entrekin
615-244-2770
SOURCE: Southern Strategic Partners LP
A service of YellowBrix, Inc.
