Summary
- Genworth stock faces uncertainty due to lack of closure on their China Oceanwide buyout.
- The bonds could be affected as well.
- What are the strategic alternatives available.
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May 28, 2019
Looks like the buyout is not going through. China Oceanwide (OTC:HHRBF) is reported to be in default on its Oceanwide Plaza in Downtown L.A., and there are still some regulatory approvals for the buyout lacking after over 30 months. We expect the deal to be canceled on or before the June 30, 2019 deadline. Since the deal was announced, shareholders have lost over $1 billion as the shares declined. We heavily advised against voting for the deal in 2016, including lobbying ISS. Broxton 2017 letter to the board of directors of Genworth (NYSE:GNW):
"In a sense GNW has no parents, the board and management don't own many shares, and it has not attracted a large holding from a competent investor that could steer or lead the company… 35% of the shares are owned by mindless index funds that have no interest in the company….. This acquisition was couched in terms of needed liquidity and failed bids. This picture was presented, in order to create the ecosystem necessary to complete the deal."
In 2016 we wrote: GNW shareholders are being enticed into a deal which makes no sense. We published extensively on various aspects of GNW.
