Vulcan International Corporation Liquidation Proceeds

According to FINRA:
12/03/2020 12:36:34 Liquidation/Final Distribution 12/11/2020 00:00:00
Initial Liquidating Distribution. Transfer Book Remain open.
Cash Amount 152.45
Payment Date 12/10/2020 00:00:00

Just Published: Issue 32 of the Oddball Stocks Newsletter!

We just published Issue 32 of the Oddball Stocks Newsletter. If you are a subscriber, it should be in your inbox right now. If not, you can sign up right here.

Remember that we have made some back Issues of the Newsletter available à la carte, so you can try those before you sign up for a subscription: Issues 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, and 31.

We also published a Highlights Issue in February. The Highlights Issue is available here for purchase as a single Issue.

If you have been curious about the Newsletter, the Highlights Issue is the perfect opportunity to try about two Issues worth of content (much of which is still topical and interesting) at a low cost.

Tower Properties Announces Massive Special Dividend ($TPRP)

This was announced last week:
On November 19, 2020, The Board of Directors of Tower Properties Company (“Company”) declared a dividend of $5,000.00 per share on each of the 4,423 shares of issued and outstanding common stock of the Company, totaling in the aggregate $22,115,000.00, payable to the holders of record of issued and outstanding shares of the common stock of the Company as of 5:00 p.m. CDT on November 30, 2020 (the “Record Date”), payable on December 17, 2020 (the “Payment Date”).
Nate wrote up TPRP in Issue 13 of the Oddball Stocks Newsletter when shares were trading for $12,500.

Report from Scheid Vineyards ($SVIN) Annual Meeting

[Low Tide Investments is a free newsletter that mainly focuses on forced selling and dividend value investment ideas. They provide monthly updates on investments they have written about in their "Monthly Roundup". Be sure to subscribe for free and follow them on twitter @lowtideinvest.]

Our friend at Low Tide Investments writes in about the Scheid Annual Meeting held (virtually) this week.
Scheid held their annual meeting via Zoom on November 17th. They confirmed and went further into many important aspects that were mentioned in their Q3 press release.

Bulk Wine demand has gone “through the roof” due to the fires and COVID-19. Scheid’s bulk wine sales hit a 6 year low in 2019. This article confirms that the supply of bulk wine across all grape varietals has declined significantly from earlier this year, and that prices for some categories have nearly doubled. Scheid’s bulk wine sales saw a 44% decline from their peak in 2017 to 2019. In the 3 months ending on August 31st, bulk wine sales are up 222% in 2020 versus the same period in 2019.

Regarding the harvest and smoke taint, Scheid reported that they have harvested 100% of their grapes. They mentioned that their micro-fermentations have not had any serious effect from smoke taint thus far, but are not yet finished. Harvest yields look to be down ~20% across the board in California, and Scheid says they are in a good position today as it relates to the growing season and harvest.

They also are being recognized more. Heidi Scheid was awarded person of the year from Wine Enthusiast Magazine and will be featured in the January issue. They have also been able to get in front of more distributors more via virtual meetings. Significant issues with travel related cased wine sales for cruise lines & airlines were more than made up for by grocery store sales. Pent up travel demand could be a tailwind for Scheid looking past the pandemic. They are also expanding their exclusive wine brands with partners such as Whole Foods, World Market, and Food Lion. Sunny With a Chance of Flowers has been successful and will be accepted into Kroger at the national level in March of 2021. There has been an explosion in the less competitive “better for you” category. They recently purchased a new bottling line that will expand their bottling efforts by 50%. Additionally, Al Scheid (Chairman) seemed eager to share the YTD case wine sales, but of course was not allowed to do so.
See our previous discussion of Scheid: A wine company at 53% of BV and 4.6x earnings, Do the Disappointing Scheid Vineyards Results Show a Bad Business in Decline?, Interpreting the Scheid Vineyard 2019 Results, and Scheid Vineyards ($SVIN) Releases Quarterly Earnings.

MVB Financial Corp. ($MVBF) Commences Modified Dutch Auction Tender Offer to Repurchase up to $45.0 Million of its Common Stock

We did a bunch of posts [1,2,3,4] on small banks last month. In our post, "Small Bank Share Cannibals," we mentioned MVB Financial (MVBF) as a share repurchaser.

Just this morning, MVBF announced a giant share repurchase:

a modified “Dutch auction” tender offer (the “Tender Offer”) to purchase, for cash, up to $45.0 million of its common stock (the “Common Stock”) at a price per share not less than $18.00 and not greater than $20.25, less any applicable withholding taxes and without interest. The Company intends to purchase the shares using available cash on hand and proceeds from an anticipated private placement of subordinated notes to certain institutional accredited investors. On November 16, 2020, the closing price of the Common Stock was $18.50 per share. The Tender Offer will expire at 5:00 p.m., New York City time, at the end of the day on December 18, 2020, unless extended or terminated.  If the Tender Offer is fully subscribed, the Company will purchase between 2,222,222 shares and 2,500,000 shares, or between 18.8% and 21.2%, respectively, of the outstanding Common Stock as of November 5, 2020
The top end of this tender price range is 107% of September 30, 2020 tangible book value.

Shareholder Letter to Vulcan International Corp (VULC) Board of Directors

We posted yesterday about the latest word - that Vulcan is supposedly making a liquidating distribution to shareholders next month, although possibly in a very clumsy way. One shareholder sent us the letter that he sent to Vulcan's board expressing dissatisfaction with the move:
Daniel F. Raider
818 Laurelwood Drive
San Mateo, California 94403

November 13, 2020

Board of Directors, Vulcan International Corporation (“Vulcan”)

By Fax to (513) 241-8199

Lady and Gentlemen:

Thank you for the belated but welcome news, conveyed to me yesterday by Tom Gettler, that Vulcan expects to make a substantial liquidating distribution next month.

I was sorry to learn from Mr. Gettler that Vulcan has experienced difficulty with its transfer agent, Computershare, and therefore does not plan to use Computershare in connection with Vulcan’s liquidating distributions. As described by Mr. Gettler, the expected method of distribution would be direct distributions by check to both individual registered shareholders and individual street name shareholders.

The latter group is diverse. It includes both NOBO’s and OBO’s, some of whom hold shares in currently taxable form and some of whom hold shares in tax-deferred or tax-exempt accounts. I tried to convey to Mr. Gettler my concern that direct distributions to these shareholders will create massive problems. These problems include the following:
  • An inability to identify OBO’s and make distributions;
  • Lack of TIN’s, incorrect TIN’s, and/or W-9 problems for NOBO’s;
  • Difficulty and potential errors by NOBO’s and/or their custodians in directing payments to the correct brokerage accounts without creating tax problems;
  • Tax compliance difficulties and expense for street name shareholders with respect to Vulcan shares held in Traditional IRA accounts and Roth IRA accounts; and
  • Errors and inconsistencies in payments because of trades in Vulcan stock which post-date any records Vulcan maintains concerning stock ownership.
Before adopting this radical (and, in my experience, unprecedented) method of distribution, I urge you to consult with individuals, e.g., representatives of transfer agents and/or broker/dealers, who are knowledgeable about back office operations.
Vulcan may wish to retain AmStock, Continental, or some other transfer agent. If Vulcan decides to manage the distribution process by itself, I strongly suggest making direct payments by check to most registered shareholders, and making payments by wire to Cede and any other nominee holders. The nominee holders far are better able to make problem-free distributions to beneficial owners than is Vulcan.

See the CoBF thread on VULC for more conversation about this. Also, Vulcan's 2018 annual meeting results announcement shows who the board of directors were as of that time. An old Section 13D filing from when Vulcan was public sheds light on the family/insider ownership:

The name of the person filing this statement is the Gettler Family Special 1997 Trust. The Trust was formed on December 17, 1997 in Hamilton County, Ohio. Its address is: 9200 Old Indian Hill Rd., Cincinnati, OH 45243-3438. The Trustee is Deliaan Gettler at the same address. It is a Trust set up by Benjamin Gettler, the husband of Deliaan Gettler for the benefit of members of the Gettler family.
Check out Deliaan Gettler's political campaign contribution history. Let us know in the comments if you have thoughts about the Vulcan liquidation.