Seeking Alpha

In a blow to investors seeking to oust the CommonWealth REIT (CWH) board, a Maryland judge rules...

In a blow to investors seeking to oust the CommonWealth REIT (CWH) board, a Maryland judge rules the dispute must be resolved through arbitration. Corvex and Related sued after the Board rejected their $27/share buyout offer and instead went ahead with a secondary offering at $19. CommonWealth then filed for arbitration as allowed by its bylaws - a process stacked against shareholders, say the plaintiffs. CommonWealth reported earnings today, but the CC dialogue was strictly limited to operations.
Comments (9)
  • Chris DeMuth Jr.
    , contributor
    Comments (4591) | Send Message
     
    This is a procedural delay, but in the end it will not change anything.
    8 May 2013, 09:13 PM Reply Like
  • goldsilver
    , contributor
    Comments (12) | Send Message
     
    Just keep the dividends coming.

     

    Gordon
    8 May 2013, 09:26 PM Reply Like
  • the_value_vulture
    , contributor
    Comments (221) | Send Message
     
    There are clear conflicting issues surrounding current management's leadership. Looks like these guys are going to go out kicking and screaming. Irregardless, with so few shareholders happy with the status quo and likely new entrants gathering in corvex's corner this little game by Portnoy and company is more of a question of when and not if they are thrown out.
    8 May 2013, 09:30 PM Reply Like
  • Michael Pomerleano
    , contributor
    Comments (16) | Send Message
     
    If anyone had any doubts that the present management, Adam Portnoy and his father, are corrupt and incompetent, they need to read the transcript of CommonWealth's conference call reported today. The questions from the Citi analyst are indicative of all the problems that management is hiding: diluting existing shareholders, refusing to release data on properties, self dealing. The father and son are acting like a mafia don and have appropriated all the rights of the shareholders.
    8 May 2013, 09:30 PM Reply Like
  • davidbdc
    , contributor
    Comments (3181) | Send Message
     
    What CWH really shows is how outdated our corporate governance system is. There are people on the board that are truly just friends of the family. This firm has constantly sold off all assets that appreciate - with the sole intent of then buying more expensive properties to increase RMR management fees. Thats the reason they won't release property specific information. It would expose how they have sold properties generating solid cash flow and replaced them with higher priced buildings producing LESSER cash flow. But management fees increase!

     

    I've owned for a long time. They have spun off several companies - I've received ZERO shares from any of the new entities, and I've received ZERO dollars and ZERO cents from any of the spin-offs. Its a legal scam.
    9 May 2013, 03:30 AM Reply Like
  • jaginger
    , contributor
    Comments (629) | Send Message
     
    Chris, by your comment you are projecting that the $19 is a done deal?
    9 May 2013, 03:18 PM Reply Like
  • Chris DeMuth Jr.
    , contributor
    Comments (4591) | Send Message
     
    I don't expect the secondary to be overturned.
    9 May 2013, 03:23 PM Reply Like
  • Special Situations and Arbs
    , contributor
    Comments (703) | Send Message
     
    Is there any timetable forthe arbitration?
    10 May 2013, 10:32 AM Reply Like
  • davidbdc
    , contributor
    Comments (3181) | Send Message
     
    From the annual meeting results:

     

    Mr. Joseph L. Morea received less than the majority of shares required to be re-elected as an Independent Trustee. As a result, Mr. Morea resigned from the Board. The Board determined that the insufficient vote for Mr. Morea appeared not to be directed at any personal failings of Mr. Morea, but rather to be the result of the positions taken by the Board to oppose the hostile takeover efforts being pursued by Corvex Management LP and Related Fund Management, LLC. In these circumstances, and because the Board's determination that Mr. Morea's continued service and leadership would be in the Trust's best interest, the Board requested that Mr. Morea accept appointment to the vacancy created by his resignation. Mr. Morea subsequently accepted appointment as an Independent Trustee.
    15 May 2013, 10:22 AM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs