James O'Neil Co-authored by Treading Softly There are points in our lives when we hit an inflection point. At that point, we need to take a moment to take stock of all that has happened before and what is going on right now so we can decide what we think is the best next step to achieve our goals. For many companies, inflection points can occur when prior plans have failed, and shareholders or investors are losing confidence in the plan the management team has laid out.
This can lead to a drop in share value. Failed strategies often lead to activist investors making moves to try to pressure the company to do what they think is best for its future. Often, the old management is fired, and the company goes in a new direction.
One great example of this would have to be Algonquin Power & Utilities Corp. ( NYSE: AQN ), yielding 7.3%.
Their plan to take over Kentucky power from American Electric Power ( AEP ) failed dramatically. Not only did they take out a large amount of debt at a time when interest rates were extremely high, but they were unable to get the regulatory approvals to complete the deal, and the assets they were buying turned out to be of lower quality than expected. This led AQN to carry a large amount of debt at a poor time, resulting in a common dividend cut.
Now that their convertible notes have become common shares, what are the future plans for AQN? Is there an activist investor who is taking an active role in trying to guide the future of the company? Today, le.
