Wednesday, February 20, 2008

Canadian 3rd Party ABCP holders turn to Facebook.com for support

(Globa & Mail Streetwise) A Calgary man stuck with a heap of frozen asset-backed commercial paper is counting on popular social networking site facebook.com to drum up support.

Many small investors have been stuck with the paper for months, especially those whose brokerage firms have declined to buy back the paper. Some firms, such as National Bank Financial, repurchased paper sold to small investors. Others, like Canaccord Capital, have not.
The group, which has nine members so far, is the brainchild of Calgary's Brian Hunter. No, not that Brian Hunter, formerly of Amaranth LLC. This Brian Hunter is just a regular guy who ended up stuck with the paper and now is looking to "generate discussion among holders of ABCP and lead to action for the benefit of noteholders contrary to the aims of the Crawford 'Vendors' committee to keep the banks and marketers whole and leave the noteholders swinging."

The group has links to recent communications with the Crawford committee and its advisors, as well as letters to government. What the postings show is that the small investors have gotten up to speed very quickly on the situation, with a deep and nuanced understanding of the underlying issues, and are not going to roll over easily. Their problem is they don't have much leverage, as the big investors that are at the table with the Crawford Committee have a majority of the paper big enough to ram through any proposed restructuring they want.

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