The Voltari Surge

An obscure mobile-advertising company named Voltari (VLTC) has soared dramatically in the last few days. It was as low as 72 cents per share on March 26, Today it’s been as high as $21.75.

What’s causing the rally? Carl Icahn.

Icahn and his funds purchased 4.06 million shares, or about 95 percent of the stock that the New York-based company sold. The holding cost $5.5 million, according to a regulatory filing, and was valued at $65.7 million as of yesterday. The purchase brought his stake to 4.74 million shares.

The gain on Voltari would be even larger if Icahn’s holdings of other equity securities were included. He and his funds owned 1.15 million preferred shares and warrants to buy 969,603 common shares, according to the filing.

Icahn’s involvement with Voltari began in February 2007, when he invested $50 million. The company was called Motricity Inc. back then and was closely held. It made an initial public offering in June 2010. The shares peaked less than five months later and then plunged as much as 99.8 percent, to 63 cents.

Voltari was a unit of Motricity, and became the parent company in an April 2013 reorganization designed to preserve loss-related tax credits. The company had net losses totaling $367.5 million from 2007 through last year, according to data compiled by Bloomberg.

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Posted by on April 22nd, 2015 at 11:43 am


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