Chapman Capital sent a letter to American Community Property Trust (AMEX:APO) today demanding that the company re-evaluate the activist hedge fund's $25/share liquidation proposal. The hedge fund, which specializes in small cap restructurings and turnarounds, has been fighting for a liquidation since REITs went out of favor causing substantial discounts to net asset values. Chapman is hoping that it can talk some sense into the resistant controlling Wilson family and unlock significant value for shareholders through a liquidation at roughly a 25% premium.

In a heated letter to ACPT today, Mr. Chapman commented, "The management team in place is implementing a long-term strategy that IS NOT WORKING. If you understood, even slightly, that your job is not to develop real estate but to build shareholder value in the public markets through real-estate related development, this would be patently obvious to you. Instead, your response, like all those that preceded it, confirms every fear I have about the Wilson family's role in the tragic underperformance of this asset-rich enterprise. Like TrizecHahn and others in the 'Old Economy', selling assets to the private market rather than waiting for the public market to realize the estimated $25/share in intrinsic value is the only viable option. Thus, on behalf of the public shareholders of ACPT, I demand that you begin an orderly liquidation of the company immediately."

Many shareholders have been disappointed with the trust's performance during the past year and are ready for change. Unfortunately, the Wilson family holds a controlling stake in the company and has openly stated that it would not support a liquidation. Usually this would eliminate any possibility of returns; however, Chapman Capital has a lot of experience in these situations and may be able to force change. If successful, the resulting liquidation would result in around 25% return to shareholders based on today's market price. This makes APO a stock worth watching!

Related Companies
Colonial Properties Trust (CLP)
Tarragon Corporation (TARR)
Franklin Street Properties (FSP)

Wendy's International (NYSE:WEN) shares moved up $1.63, or 3.64%, to $38.75 today after Nelson Peltz disclosed a 9.8% stake and identified Triarc as a "natural, strategic buyer" for the struggling restaurant chain. Many investors are hoping that Nelson Peltz will be able to use his weight on the board to pursue the best value for shareholders.

Nelson Peltz is a successful activist investor that was responsible for Wendy's earlier decisions to spin-off its Tim Horton subsidiary and sell off its Baja Fresh chain to an investment group. These efforts provided healthy returns to shareholders in the past and many are hoping that the activist investor's new push to remove substantial barriers for a sale of the entire company will yield similar results.

Nelson Peltz expressed his concern today over Wendy's restrictive one-year standstill clause that drew criticism from Triarc. The activist investor believes that the company has a strong bias against Triarc but should work to include them in the sale process despite these differences - as the board has a fudiciary to shareholders to pursue the greatest value.

While there are no official bids for the company yet, clearly we have two parties that may be interested in putting a bid together. Nelson Peltz request that the standstill clause be removed (which should be followed given his board presence) which should pave the way to more bids from a wider audience. Whether or not these bids materialize at a substantial premium remains to be seen; however, WEN is definitely a stock worth watching in the meantime.

Related Companies
McDonalds Corporation (MCD)
Trairc Companies (TRY)
Rubio's Restaurants (RUBO)

FairPoint Communications (NYSE:FRP) is one step closer to its purchase of Verizon's (NYSE:VZ) land lines businesses in Vermont, New Hampshire and Maine. The $2.47 billion deal will provide FairPoint with 1.48 million access lines - more than eight times the company's current 248,000 lines. The telecommunications company hopes that this deal will give them a larger footprint in key markets; however, many investors are concerned that the transaction will put the company in a weak financial position.

The majority of the concerns over the deal stemmed from unions representing the bulk of Verizon's workers in the three states who are worried that the $1.7 billion in debt assumed may hinder promised investments and endanger the workers' pensions and benefits. Meanwhile, other shareholders are worried that the large acquisition will necessitate additional infrastructure spending that will significantly impair the company's financial condition.

FairPoint executives addressed these concerns on Thursday by reassuring investors that the existing $1.2 billion revenue stream from Verizon's operations in these states will support operations, capital improvements, dividends and interest on debt. Management also predicts that the transaction will be immediately accreditive to the company's earnings. Many large investment banks have also offered opinions on the transaction that is being spearheaded by Morgan Stanley.

Overall, the transaction should significantly increase FairPoint's footprint in the Eastern United States while increasing the company's revenues. Management's estimates also suggest that the transaction will leave the company in a strong financial position. Plans do not always turn out perfect, however, so investors should pay close attention to the company's costs through the process. In the end, this is a big move by the company that could either reward shareholders with a much larger entity or hurt them with excessive debt.

Related Companies
TimeWarner Inc. (TWX)
Yahoo! Inc. (YHOO)
Microsoft Corporation (MSFT)