I think I'm missing something. Why are only the minority shares considered in valuing the bank? Do the MHC shares not have identical claims on cash flows and liquidation rights as the publicly traded shares?
Hi D_F_V, apologies for the delayed response. It's not that the MHC doesn't have a claim on the business but more so about the timing of the claim/interests in the business. The only real economic claim on a partially converted thrift are public shareholders (at that time). Obviously, the MHC has rights to a second-step, but if another MHC bought out (which is allowed) this partially converted thrift beforehand, it's my understanding that only the public shareholders would be entitled to the proceeds while the existing MHC shares would have their second-step conversion ownership rights rolled over into whatever MHC had just bought them.
Hi, Thanks for the post. I am new to thrift conversions. There was a recent writeup on CFSB on ValueInvestorClub. I would be curious to get your thoughts on the setup.
Also, is there a required minimum amount of time between a first step conversion and a second step conversion? Do they have to wait 12 months before a second step? Haven't been able to find anything on that in the S1 or more generally elsewhere.
I think I'm missing something. Why are only the minority shares considered in valuing the bank? Do the MHC shares not have identical claims on cash flows and liquidation rights as the publicly traded shares?
Hi D_F_V, apologies for the delayed response. It's not that the MHC doesn't have a claim on the business but more so about the timing of the claim/interests in the business. The only real economic claim on a partially converted thrift are public shareholders (at that time). Obviously, the MHC has rights to a second-step, but if another MHC bought out (which is allowed) this partially converted thrift beforehand, it's my understanding that only the public shareholders would be entitled to the proceeds while the existing MHC shares would have their second-step conversion ownership rights rolled over into whatever MHC had just bought them.
Hi, Thanks for the post. I am new to thrift conversions. There was a recent writeup on CFSB on ValueInvestorClub. I would be curious to get your thoughts on the setup.
Also, is there a required minimum amount of time between a first step conversion and a second step conversion? Do they have to wait 12 months before a second step? Haven't been able to find anything on that in the S1 or more generally elsewhere.
You're book just arrived at my house today. Thanks for writing it!