Earlier today we mentioned that FrontPoint Partners’ Steve Eisman has just about had it with Genworth Financial and told them as much on a conference call this morning in which he threatened to wage a proxy battle on their asses and throw management “out of here.” A clip has now been posted and the audio version is even better than reading in print (flashbacks to being yelled at by your father may ensue, particularly on the “DO NOT DO THAT” line). [Shareholder, Stevo enters around 38:14 and the juice is at 40:00]
Steve Eisman Tells Genworth Financial It’s “Overseen Massive Destruction Of Shareholder Value,” Threatens To Wage Proxy Battle On Conference Call, Throw Management “Out Of Here”By Bess Levin
Jazzy-Jeff style. Do not test him on this one.
Operator: Steven Eisman, FrontPoint.
Steven Eisman: Yes, hi. I think it is pretty clear this was a very poor quarter, but there are larger issues here that I think you need to address. Frankly, the only accomplishment that this management team can truly point to is the survival of this Company, which I don’t mean to minimize, but otherwise, this management team has overseen a massive destruction of shareholder value. In fact, at the current price to book, Genworth is selling at a steep discount to both MGIC and PMI, the pure play MIs and this is probably because this Company does not meet its cost of capital in any of its businesses. In other words, the market currently is ascribing negative value to your non-MI businesses. It’s a pretty astonishing statement and I don’t get any sense of urgency from this management team as to how this is all going to be addressed. I think going down the current road seems to me a complete waste of time.