[schnoodleC]

Companies like this one pop up from time to time. Usually what happens is that a company sells out but rather than distributing cash to shareholders, management and/or the majority owners convince the board to keep the company around with the cash and roll the whole enterprise into another venture. Both DCat and myself are currently invested in such a situation with the Kaiser Group.

However, you have to understand that there is significant downside. The downside risk is two fold:

1) Management will fail in their new endeavor. It is hard to find a good company to buy or to start a new one. Even if management is talented they may fail.

2) They will just sit on the money forever earning very little.

For myself, I usually invest in the hopes that they will give up and liquidate the company or that the other shareholders can force the company to liquidate. Actually seeing them go ahead with a startup is not what you usually want.

Finally, understand that these type of plays take a lot of time, sometimes years. Be sure you have the patience for it.