Siddharth Dalal - Seeking Alpha 'Siddharth Dalal' Tag RSS Syndication from SeekingAlpha.com SeekingAlpha.com http://seekingalpha.com/author/siddharth-dalal Robbing Peter to Pay Paul: More on Wachovia / Citi http://seekingalpha.com/article/98321-robbing-peter-to-pay-paul-more-on-wachovia-citi?source=feed 98321 Continuing my previous post on the Citi (C) / Wachovia (WB) deal, and some comments from myself and others on that post , here is what is known so far.

At the end of the year, we will get proxy statements and will be able to vote on the deal. I sure as hell am not voting for it unless something significant changes about the deal. As it stands, Citi paid just over $14 billion for Wachovia’s assets that it plans to take over - $12B to the Feds and the rest to Wachovia, and the Feds brokered this deal. Citi also agreed to cover up to $42 billion in losses on Wachovia’s mortgage portfolio. Anything above that the Feds will cover. But Citi's CEO also stated that the losses will not go beyond $42 billion. What the hell is the Feds being paid $12 billion for then? Why is that not being paid to Wachovia? This is like robbing us Wachovia shareholders and paying the Feds for absolutely no plausible reason.

]]> Thu, 02 Oct 2008 15:35:46 -0400 Siddharth Dalal Continuing my previous post on the Citi (C) / Wachovia (WB) deal, and some comments from myself and others on that post , here is what is known so far.

At the end of the year, we will get proxy statements and will be able to vote on the deal. I sure as hell am not voting for it unless something significant changes about the deal. As it stands, Citi paid just over $14 billion for Wachovia’s assets that it plans to take over - $12B to the Feds and the rest to Wachovia, and the Feds brokered this deal. Citi also agreed to cover up to $42 billion in losses on Wachovia’s mortgage portfolio. Anything above that the Feds will cover. But Citi's CEO also stated that the losses will not go beyond $42 billion. What the hell is the Feds being paid $12 billion for then? Why is that not being paid to Wachovia? This is like robbing us Wachovia shareholders and paying the Feds for absolutely no plausible reason.


Complete Story »]]> C WB Siddharth Dalal The Lowdown on Citi / Wachovia http://seekingalpha.com/article/97835-the-lowdown-on-citi-wachovia?source=feed 97835 As a Wachovia (WB) investor, I was shocked by this morning's news - it was just too much, too fast. Anyway, based on the news this morning, here is the lowdown on the deal.

Citi (C) takes over Wachovia's banking/mortgage business: Citi pays Wachovia $2.1 billion in stock in exchange for Wachovia’s banking and mortgage assets (over $700 billion in deposits+assets). Citi also assumes about $53 billion in debt. Citi needs to cover losses up to $42 billion on mortgage related losses. Anything beyond that is guaranteed by the Federal government. In exchange for that guarantee, the Feds get $12 billion in preferred Citi stock, which pays 6% interest - possibly a sweet deal for the Feds. Wachovia's over $300 billion mortgage portfolio had about $120 billion in option-ARM mortgages and expected losses on about 14% of those loans, but really, is the deal justified?

]]> Mon, 29 Sep 2008 12:45:47 -0400 Siddharth Dalal As a Wachovia (WB) investor, I was shocked by this morning's news - it was just too much, too fast. Anyway, based on the news this morning, here is the lowdown on the deal.

Citi (C) takes over Wachovia's banking/mortgage business: Citi pays Wachovia $2.1 billion in stock in exchange for Wachovia’s banking and mortgage assets (over $700 billion in deposits+assets). Citi also assumes about $53 billion in debt. Citi needs to cover losses up to $42 billion on mortgage related losses. Anything beyond that is guaranteed by the Federal government. In exchange for that guarantee, the Feds get $12 billion in preferred Citi stock, which pays 6% interest - possibly a sweet deal for the Feds. Wachovia's over $300 billion mortgage portfolio had about $120 billion in option-ARM mortgages and expected losses on about 14% of those loans, but really, is the deal justified?


Complete Story »]]> C WB Siddharth Dalal Where Blockbuster Went Wrong http://seekingalpha.com/article/57396-where-blockbuster-went-wrong?source=feed 57396 I’m a loyal Blockbuster Online customer (but not a stockholder) and have been following the Blockbuster (BBI) / Netflix (NFLX) battle for a while now. I applauded the Total Access service, was disappointed when they limited my Total Access DVDs to five per month and now after seeing how Blockbuster works I can comment on all the places they went wrong.

]]> Sun, 16 Dec 2007 05:17:20 -0500 Siddharth Dalal I’m a loyal Blockbuster Online customer (but not a stockholder) and have been following the Blockbuster (BBI) / Netflix (NFLX) battle for a while now. I applauded the Total Access service, was disappointed when they limited my Total Access DVDs to five per month and now after seeing how Blockbuster works I can comment on all the places they went wrong.


Complete Story »]]> BBI Siddharth Dalal Netflix's Dismal Earnings Come as No Surprise http://seekingalpha.com/article/42238-netflix-s-dismal-earnings-come-as-no-surprise?source=feed 42238 This should come as no surprise because Netflix did absolutely nothing to compete with Blockbuster (BBI) Total Access. They just sat and waited for Blockbuster to raise prices. Instead Blockbuster responded by offering the same plan as Netflix (i.e. without Total Access) for a dollar less than Netflix. This has forced Netflix to lower prices too!

In the words of analyst Michael Pachter of Wedbush Morgan, "Blockbuster is kicking their butts, and they're not used to that." Not that Blockbuster is doing great financially, but unless Netflix comes up with something to compete with Total Access, Blockbuster has the upper hand.

What can Netflix do? Netflix could open Kiosks. Or they could buy RedBox or just partner with Redbox to allow Netflix subscribers to return and rent DVDs like Blockbuster does with its stores instead of just waiting it out. On a positive note, at least Netflix makes money - unlike Blockbuster. However if the trend continues, the tides may turn, especially if Blockbuster does something to improve their (IMHO it's a fancy but not extremely useful website).

]]> Wed, 25 Jul 2007 05:44:34 -0400 Siddharth Dalal This should come as no surprise because Netflix did absolutely nothing to compete with Blockbuster (BBI) Total Access. They just sat and waited for Blockbuster to raise prices. Instead Blockbuster responded by offering the same plan as Netflix (i.e. without Total Access) for a dollar less than Netflix. This has forced Netflix to lower prices too!

In the words of analyst Michael Pachter of Wedbush Morgan, "Blockbuster is kicking their butts, and they're not used to that." Not that Blockbuster is doing great financially, but unless Netflix comes up with something to compete with Total Access, Blockbuster has the upper hand.

What can Netflix do? Netflix could open Kiosks. Or they could buy RedBox or just partner with Redbox to allow Netflix subscribers to return and rent DVDs like Blockbuster does with its stores instead of just waiting it out. On a positive note, at least Netflix makes money - unlike Blockbuster. However if the trend continues, the tides may turn, especially if Blockbuster does something to improve their (IMHO it's a fancy but not extremely useful website).


Complete Story »]]> NFLX Siddharth Dalal What's the Best Way to Invest in India? http://seekingalpha.com/article/39122-what-s-the-best-way-to-invest-in-india?source=feed 39122 Barclays India Exchange Traded Note (INP) showed up, the only options other than regular mutual funds were the CEF’s - The India Fund Inc. (IFN) and Morgan Stanley's India Investment Fund (IIF). Both IIF and IFN were easily beating the Indian Market (BSE and NSE). Then came INP - an exchange traded note. I won’t go into details, but INP tracks the top 68 stocks in the NSE including dividends. No dividends are actually paid to the stockholders; they are just automatically reinvested into the share price of INP.

Both the India funds, IIF and IFN, used to trade at significant premiums and both now trade at discounts of about 13%! (as of Friday). Over the last year, while the Indian Stock Market has reached and stayed around all time highs (albeit with some volatility), IIF and IFN have not moved significantly with their discount steepening.

]]> Fri, 22 Jun 2007 04:05:17 -0400 Siddharth Dalal Barclays India Exchange Traded Note (INP) showed up, the only options other than regular mutual funds were the CEF’s - The India Fund Inc. (IFN) and Morgan Stanley's India Investment Fund (IIF). Both IIF and IFN were easily beating the Indian Market (BSE and NSE). Then came INP - an exchange traded note. I won’t go into details, but INP tracks the top 68 stocks in the NSE including dividends. No dividends are actually paid to the stockholders; they are just automatically reinvested into the share price of INP.

Both the India funds, IIF and IFN, used to trade at significant premiums and both now trade at discounts of about 13%! (as of Friday). Over the last year, while the Indian Stock Market has reached and stayed around all time highs (albeit with some volatility), IIF and IFN have not moved significantly with their discount steepening.


Complete Story »]]> IFN IIF INP Siddharth Dalal