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Talk of the Bay
A little good news for Tropical's shareholders
By MARK ALBRIGHT
Published June 12, 2006
Usually shareholders' investments are wiped out when a company goes bankrupt. But stockholders of ill-fated Tropical Sportswear International Corp. stand to get at least some pocket change from the 2004 sale and liquidation of the Tampa apparel company. So some snake-bitten Tropical shareholders may want to find some new wallpaper for that cherished-memories corner of the rec room. Thanks to a 2003 shareholder class-action suit that was pending against the company and four of its top executives, Tropical's insurance company kicked in $8-million to be distributed among shareholders who took the stock's roller coaster ride between Jan. 27, 2001, and the eventual sale to Perry Ellis International Inc. and Chapter 11 bankruptcy filing on Jan. 14, 2004. U.S. District Court Magistrate Thomas Wilson is scheduled to hold a hearing July 10 on the settlement in Tampa. The company and its executives admitted no guilt in settling the suit that alleged they misled investors with rosy projections that shrouded the company's rapidly deteriorating business. Eight days before one particularly bad earnings report, insiders pocketed $12-million unloading shares that reduced their stake in Tropical from 45 to 20 percent, the suit claimed. Exactly how much individual shareholders get depends on how many file a claim and a complicated formula based on when they sold shares and for how big a loss. But it's estimated a third of the settlement will pay court costs and attorneys fees, leaving stockholders to wrestle over about $1.13 a share. That's a long way from the $22.65 a share Tropical raked in from its last public offering eight months before the company's financial performance tanked. But it's better than the 44 cents a share Tropical traded for the day the company disclosed it had filed for Chapter 11 bankruptcy. - MARK ALBRIGHT, Times staff writer
[Last modified June 12, 2006, 06:37:59]
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