Enzon Pharmaceuticals, Inc. (NDAQ: ENZN) shares moved higher after a large investor disclosed that they hired an advisor to explore strategic alternatives for the company in a Schedule 13D filing with the SEC. DellaCamerca Capital Master Fund engaged the investment banking firm Moelis & Company LLC to explore strategic alternatives with respect to the investment in the company. The 7.8% shareholder is likely attempting to find a buyer to boost the share price.

Last quarter, Enzon reported strong results and a net loss of just $2 million or $0.05 per share. The third quarter results were impacted by the $88.7 million net gain from the sale of a portion of their PEG-INTRON royalty asset. All in all, the company remains strong and continues to see growth and stability in their marketed products. Unfortunately, the volatile external markets impacted the ability to complete the sale of their specialy businesses at this time, however.

The strategic transactions that Enzon is already undertaking represents an effort to unlock value while many of its shareholders also continue to explore ways to maximize their investment. The result has been a stock in decline so far but opportunity in the near future. Shares of the pharmaceutical firm rose $0.08, or 1.86%, to $4.38 per share on the day.

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Mark-to-market accounting is a term that has received a lot of press in recent months as toxic securities seemed to come out of the woodwork. The idea is that companies holding illiquid securities should sell a few to get a fair market price and then value their portfolio at that value rather than an "estimated value" or "last trade value". The big debate now is whether or not mark-to-market accounting is good or bad for companies, investors and the general public.

The SEC announced today that it would hold a November 21st roundtable concerning this mark-to-market process. The first panel will focus on:

• Usefulness of mark-to-market accounting to investors
• The sufficiency of information and the ability to improve the reliability regarding the valuation of assets recognized at fair value that do not currently trade in an active market
• Challenges encountered and best practice used by preparers of financial statements related to estimating fair value during the current market conditions
• Whether there are aspects of the current fair value measurement accounting standards that are not sufficiently clear, and if so, what are the areas that could be improved and how
• Whether there needs to be more education related to fair value measurements
• Challenges that auditors have faced and best practice employed in providing assurance regarding fair value accounting
• Ways to increase transparency and consistency in the application of impairment models for investments not held for trading purposes

The mark-to-market represents a major problem in the marketplace as illiquid trading may cause securities to trade well below their intrinsic valuation. For example, if a mortgage security is rating AAA grade and expected to come to value in 30 years, but no credit is available for investors to purchase mortgages then nobody will be willing to pay any price for them. As a result, marking them to market may cause an unnecessarily low valuation for a security that may really be worth much more. However, others insist that the only real value is the market value and as a result this is a very fair way of doing things.

International Shipholding Corporation (NYSE: ISH) may be charting a new course after an activist investor took aim at the board. Liberty Shipping Group owns a 9% stake in the firm and previously made an offer to acquire the company. The board established a "special committee" to review the proposal, but failed to take action on the offer. This prompted Liberty to take matters into its own hands and attempt a coup of the board.

Here's the letter they submitted:

We were cautiously optimistic when the special committee’s advisors reached out to us on November 7 with an indication that we start giving consideration to a due diligence request list in connection with our proposal to acquire International Shipholding (ISH). We promptly sent your legal advisors a due diligence request list and a draft confidentiality agreement, which contained terms comparable to those that ISH agreed to when we provided at your request confidential information relating to Liberty’s ability to finance the proposed transaction. Four days later we received your proposed changes and additions to the confidentiality agreement. Our optimism turned to dismay with the realization that the special committee, management, the Johnsen family and their respective advisors are continuing to engage in more of the same obstructionist tactics that have characterized their actions since we initially raised the possibility of a business combination over five months ago.

In particular, we are very disappointed with your request that we agree to a standstill provision, as well as covenants directed at limiting our ability to communicate with other ISH shareholders. Perhaps even more egregiously, you asked that we agree to covenants imposing restrictions on our ability to conduct our day-to-day business in exchange for the receipt of ISH information. These provisions are entirely unacceptable and inappropriate under the circumstances.

Aside from a couple of brief telephone conversations between our advisors during the last ten days and the receipt of your mark-up to our proposed confidentiality agreement, there continues to be no dialogue between us. Both the committee and its advisors are in a constant state of paralysis and unable to act on a real-time basis, or otherwise do or say anything without apparently first consulting with the Johnsen family. This is contrary to your fiduciary duties as directors of ISH, and frankly defeats the purpose of forming a special committee to review our offer.

At this point it has become clear to us that ISH’s current board and the members of the so-called “special committee” are acting at the direction and for the benefit of the Johnsen family and not in the best interest of stockholders. Therefore, we will seek to replace the entire ISH board at the company’s next annual meeting. In the coming weeks we will provide further details to our fellow stockholders about the individuals who we will nominate to replace the Johnsen board. In the meantime, we will continue to prosecute our previously filed complaints in state and federal court. As you are undoubtedly aware by this point, we intend to hold each ISH director fully accountable for his actions and omissions to ISH’s stockholders.

We continue to desire to engage in a cooperative dialogue with you, but, in light of your actions to date, the burden is now firmly on the special committee to demonstrate that it is prepared to act independently and in the best interest of all ISH stockholders.

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