October 4, 2007
SLM: A Shareholder Speaks
Here is the letter QVT Financial, holder of 1.4 million shares of SLM, sent to the SLM board today. The letter is worth a read since it is the best look to date at the financial case for why no MAC occurred to SLM. It also doesn't look very kindly on the warrant component of the buy-out groups latest renegotiation proposal. In any event, the letter is similar to the one Stark investments sent to Accredited Home Lenders in the midst of its MAC dispute with Lone Star. There -- Stark couldn't avert a settlement though it may have led to AHL bargaining harder than it otherwise would have. This is arguably the aim here. Though, remember here they are bargaining under the buy-out group's absolute right to walk by paying $900 million.
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