With so much activity around some alternative restructuring opportunities being offered for Capital Senior Living, it is no wonder they decided to postpone the shareholder meeting to vote on the Conversant Capital proposal. The new date is October 22, 10 days later than the original date of October 12.
Previously, Ortelius Advisors (which owns about 13% of Cap Senior) disclosed their own recap proposal with terms that were cheaper than those of Conversant Capital. Now, Invictus Global Management has announced they too can arrange up to $150 million of new capital for Cap Senior, also at better terms for the company, and current shareholders, than the current Conversant Capital deal.
For shareholders, is this a bird in the hand, two in the bush scenario? Take the concrete proposal which has been signed, even though it is very expensive and very dilutive? Or vote this down, figuring that at least one of the alternatives proffered by Ortelius and Invictus may pan out?
In theory, they all want to increase shareholder value, but with the Conversant deal they would be by far the largest and controlling shareholder with their convertible preferred shares. Although the bird in the hand appeared to be the most appealing option two months ago, current shareholders may want to re-think their options, and either sell out now or vote no and see what flushes out with the other proposals, even though neither is definitive. The board owes it to shareholders to at least talk, and maybe that’s what these 10 days are meant for. We hope so. Or, maybe some other shareholders are finally flexing their shareholder muscles. If so, they should have done it months ago.
