Penson - What's this all about?

Shares in brokerage and clearing firm Penson Worldwide have dropped almost 30% to 21 cents, earlier falling as low as 16 cents. The firm earlier this week disclosed plans to tap $5.5 million in regulatory capital in order to pay down interest on outstanding debt.

Penson is pursuing “strategic transactions” that could involve sale of its securities and futures clearing business, the core of the company.

Penson shares earlier hit a single-stock circuit breaker in midday trading. It has fallen 93% in the past year and has received a warning of potential delisting from Nasdaq OMX.
http://blogs.wsj.com/marketbeat/2012/05/25/embattled-pension-stock-plumbs-fresh-lows/?mod=yahoo_hs

PENSON IS SELLING?
 
Quote from Toonces:

Just to be clear...this is same Penson that clears for several retail brokerages, correct?
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Numerous brokers.

"approximately 237 active securities clearing correspondents and 68 futures clearing correspondents as of March 31, 2012 excluding 45 securities correspondents associated with our PFSL and PFSA subsidiaries."
 
Embattled Penson Stock Plumbs Fresh Lows



By Jacob Bunge

Shares in brokerage and clearing firm Penson Worldwide have dropped almost 30% to 21 cents, earlier falling as low as 16 cents. The firm earlier this week disclosed plans to tap $5.5 million in regulatory capital in order to pay down interest on outstanding debt.

Penson is pursuing “strategic transactions” that could involve sale of its securities and futures clearing business, the core of the company.

Penson shares earlier hit a single-stock circuit breaker in midday trading. It has fallen 93% in the past year and has received a warning of potential delisting from Nasdaq OMX.

'Penson is pursuing “strategic transactions” that could involve sale of its securities and futures clearing business, the core of the company.''

sipic lquidation?
 
Quote from zdreg:

Embattled Penson Stock Plumbs Fresh Lows



By Jacob Bunge

Shares in brokerage and clearing firm Penson Worldwide have dropped almost 30% to 21 cents, earlier falling as low as 16 cents. The firm earlier this week disclosed plans to tap $5.5 million in regulatory capital in order to pay down interest on outstanding debt.

Penson is pursuing “strategic transactions” that could involve sale of its securities and futures clearing business, the core of the company.

Penson shares earlier hit a single-stock circuit breaker in midday trading. It has fallen 93% in the past year and has received a warning of potential delisting from Nasdaq OMX.

'Penson is pursuing “strategic transactions” that could involve sale of its securities and futures clearing business, the core of the company.''

sipic lquidation?
More...

It is the parent firm that is broke, not the operating clearing firm.

There is no reason the Penson clearing business can't be sold as is to a willing buyer for a lowball price.

No liquidation of the operating clearing firm required.
 
Quote from jeb9999:

It is the parent firm that is broke, not the operating clearing firm.

There is no reason the Penson clearing business can't be sold as is to a willing buyer for a lowball price.

No liquidation of the operating clearing firm required.
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"There is no reason the Penson clearing business can't be sold as is to a willing buyer for a lowball price.

this situation has been ongoing for a few years.other clearing firms have certainly looked at it with no deal.
 
WOW ... imagine the problems Goldman must have with excess cash. It must be even more vexing not having a parent company that is unable to meet its next debt payment; then how do you get rid of that albatross of those problematic excess balances. My goodness ... what to do!

Are the regulators there to force them to disgorge that surplus? Because if they are it is a clear case of over regulation. Man ... this clown beats this drum to death. Penson is a firm that has had in the past (and maybe currently) regulators camped out in a pup tent in their offices. Give it up man! Call if you have any good race track investments for me!!!

Quote from rmorse:

What it means is that the broker, Penson Financial and Penson Futures has more cash than they need.
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Let's say worst case scenario Penson has to get bailed out by SIPC. I would assume that anyone with a brokerage account clearing through Penson would get a check to cover their balance...I just wonder how long they would have to wait.
 
For several years I have considered Penson to be poorly managed and wondered how Penson was able to hold onto the number of brokers they cleared for. Maybe Penson will hang-on with a share price of zero.
 
Quote from Toonces:

Let's say worst case scenario Penson has to get bailed out by SIPC. I would assume that anyone with a brokerage account clearing through Penson would get a check to cover their balance...I just wonder how long they would have to wait.
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the brokerage firm Penson Financial has plenty of cash. The debt is with the holding company.
 
Quote from zdreg:

"There is no reason the Penson clearing business can't be sold as is to a willing buyer for a lowball price.

this situation has been ongoing for a few years.other clearing firms have certainly looked at it with no deal.
More...

Penson management hasn't in the past been looking to sell the clearing business. They had been in expansion mode until Summer 2011.

It was only September 2011 they sold the Australian clearing subsidiary and put the Canadian and UK subsidiaries up for sale. The UK subsidiary was closed in December 2011 after finding no buyer. Still waiting for news of the Canadian sale.

Things are very different now being between a rock and a hard place.
 
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