What Are Georgia Gulf Shareholders Thinking?

| About: Axiall Corporation (AXLL)

Let's talk more about the bond funds that now own Georgia Gulf Corp (GGC).

FMR (Fidelity) is the largest holder and owns 8,986,271 shares which is 27.286%.
Capital World Investors owns 8,770,360 shares which is 26.6%
Pioneer High Yield Fund has 3,374,442 shares or 10.23%, with various other Pioneer funds owning more.

I am trying to think about what these guys are thinking. There is no way you can sell 9 million shares of a stock that trades 200,000 on a big day.

So maybe they won't try? Their incentive is to try to keep the price up so as to keep the NAV of their funds up. (Although, if I was in their shoes, I would just sell unemotionally. Space it out over a few days, but sell.)

Maybe they will even buy a little - in for a penny, in for a pound - from the really small holders. Maybe that is what the bid has been the past few days.

No, the risk is the people - and there are a few dozen - that own 50,000 to 500,000 shares. They could make a clean dump over a few day period and recover most of what they paid for the bonds which they exchanged for equity.

This is a prisoner's dilemma among the really large holders. It would be best for them to work together, soak up the shares from the small holders and prop up the price on their vastly larger holdings. But they would be throwing away money on overpriced shares. Someone would want to shirk the duty.