The reverse cannibalization statement has been issued byPhillips, who says he is not optimistic that a takeover will befinalized. He says the statement has been issued "because of theexisting confusion and speculation in the marketplace regarding thefuture of FirstPlus."
Nineteenth Investment is primarily a real estate acquisition andfinance company. The negotiations center on a tax-freestock-for-stock transaction that would place Nineteenthstockholders in control of the home mortgage lender andsubstantially dilute FirstPlus shareholders' interests, accordingto Phillips' statement.
"FirstPlus believes that there is significant likelihood thatthe issues may not be resolved and that the transaction will notmove forward," says Phillips. "In which case, the liquidation ofFirstPlus may be necessary."
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