Aurelius has a monkey wrench – Citadel had their plan all in place – take all the stockholder equity in bankruptcy, keep the same management in place that drove the company into bankruptcy, and reward them on the other side with $100 million in bonus money post bankruptcy “job well done”.
Aurelius believes the radio business is turning around that the assets of the company are grossly undervalued and a few weeks ago started buying up the “worthless” common stock – it was $.02 a share – they bought 16 million shares at .07 a share – today the stock is at $.41 a share – which suggests that more than just Aurelius thinks the Chapter 11 bankruptcy will not finish according to the prewritten script. The cynical view is they did this only to force Citadel’s management to pay them off to “just go away”. The optimistic view is that someone is about to propose a different resolution to the bankruptcy judge that will be too good to ignore. Stay tuned
About 15 milion shares of Citadel traded today – up another 16% on a day the market was going down. It might just be clueless penny stock traders joining a stampede – but I suspect there is other “smart money” in the game. The total market cap of all the stock is still only around $100 million