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Prescott again asks Levitt to reconsider rights offering
By Lisa Kerner
Charlotte, N.C., Sept. 26 - Levitt Corp. investor Prescott Group Capital Management, LLC reiterated its opposition to the company's proposed rights offering in a Sept. 26 letter to the board. The letter was included in a schedule 13D filing with the Securities and Exchange Commission.
Prescott called the offering "nothing more than the blatant forced sale at $2.00" and said the sale "favors insiders with an unethical advantage of relevant information."
According to Prescott's letter, the average minority Levitt shareholder has minimal disclosure of information as required by the SEC.
Prescott believes it is the board's fiduciary duty to significantly curtail or eliminate the offering.
As previously reported, the company set a subscription price of $2.00 for its rights offering of up to 100,000,000 shares of its class A common stock. The amount of subscription rights to be distributed for each outstanding share of Levitt's common stock will be determined based on the total number of outstanding shares as of Aug. 27.
In a Sept. 18 schedule 13D filing, Prescott demanded that Levitt's board members abandon the company's "coercive rights offering" in favor of non-dilutive financing.
The reporting persons own 2,872,338 shares, or 15.4%, of Levitt's outstanding stock.
It was previously reported that BFC Financial Corp. terminated its merger agreement with Levitt in the belief that closing conditions could not be met. Levitt's board decided to proceed with a previously announced rights offering with participation by BFC, a Fort Lauderdale, Fla.-based private investment firm.
Levitt is a homebuilding and real estate development company based in Fort Lauderdale, Fla.
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