SPY Ceases to be a Public Company

SPY filed a form 15-12G with the Security and Exchange Commission on December 11th. The press release that accompanied the filing stated, “As a result of this filing, the Company ’ s obligations to file certain reports with the SEC, including annual, quarterly and current reports on Form 10-K, Form 10-Q and Form 8-K, respectively, was immediately suspended. Other filing requirements will terminate upon the effectiveness of the Form 15, which is expected to occur 90 days after filing.“

Here’s a link to the complete press release.

They said they made this decision because of the cost of being public, the management time required, and the low trading volume of the stock. We learn in the filing that there were only 71 shareholders of record.

This is a good decision by SPY. I wish I understood why it didn’t happen sooner. The bad news from my point of view is that we won’t have a quarterly opportunity to follow a smaller company in our space, as there will be no more public filings. I guess we get to see one more as it takes 90 days for the filing to become effective.

As you know, Seth Hamot, the company’s interim Chief Executive Officer and Chairman of the Board of Directors has around $20 million loaned to SPY through a company he controls. For all the correct management things they’ve done at SPY in the last couple of years, I have yet to see a way to create a business model that results in a valuation that allows all that money to be recovered. That pretty much sums up what I’ve been writing every quarter for a while now.

Whatever ultimately happens to this company, and whatever deal may or may not get made, it would certainly seem preferable, if it were me, not to have to make it in the glare of the public spotlight.

I have no information that anything is about to happen or is being planned to happen. The reasons given for no longer being public are certainly enough justification for the decision in and of themselves.

But if there were some idea of doing some deal- imminently or down the road- this might be a logical first step. We’ll see.