MuniMae

[tucker]

Municipal Mortgage and Equity, LLC (MuniMae) (NYSE:MMA)
Recent Price: $16.84
Revenue: ?
Market Cap: $649mil
EPS: ?
Shares Outstanding: 38.5mil
12-month high/low: $32.20/$13.01
Avg. Volume: 285,968
Dividend: $2.10
Book Value: ?
Yield: 12.47%

Business and social responsibility

MuniMae (MMA) is a real estate finance company that operates in several areas that may be of interest to RainFrog.

The largest part of the MuniMae’s business is in affordable housing. The company places and invests in municipal bonds for urban renewal and for the construction of multi-family housing. Most of MuniMae’s projects are in the US where they qualify for low-income housing tax credits, and the company uses its expertise in this area to manage and resell tax credits for other investors. Recently MuniMae has expanded its business to finance affordable housing in emerging market countries, with a special focus on South Africa.

MuniMae’s subsidiary MMA Renewable Ventures finances renewable energy projects. The company’s renewable energy portfolio includes private installations such as the solar facilities at Fetzer Vinyards (900 kW, Hopland, CA) and Estee Lauder (600 kW, Oakland, NJ) and public installations such the US’ largest solar production facility at Nellis Air Force Base (14MW, Las Vegas, NV). The company also harvests and sells renewable energy credits that can be used to meet governmental mandates such as New Jersey’s Renewable Portfolio Standards. In May of 2007, MMA Renewable Ventures announced that it would begin financing energy efficiency projects at existing public and private facilities in addition to new generation projects. Energy efficiency projects will include efficiency audits by the MMA team as well as capitalization for efficiency upgrades.

MMA Sustainable Land Investments is engaged in conservation banking. Many US states require developers to set aside a portion of any land they will develop for conservation. However, land parcels set aside for conservation are often too small or too fragmented to maintain their ecological function. Conservation managers are increasingly aware that the long-term maintenance of biodiversity will require not only the sound management of human-dominated landscapes but also large tracts of minimally disturbed natural habitat. MuniMae operates in the space created by the apparently conflicting interests of developers and conservationists. The company buys large parcels (150 to >5,000 acres) of sensitive land, including wetlands and endangered species habitat, and then sells the conservation credits from these parcels to developers for use elsewhere. In this way, the company can consolidate what would be a large number of small land parcels into a smaller number of larger parcels with higher conservation potential. In addition to selling conservation credits, MuniMae believes it may be able to harvest additional revenues from its conservation properties by selling water quality and carbon credits and, where appropriate, through limited recreational, sustainable forestry, or sustainable agriculture use.

MuniMae also operates MMA Finance, a diversified real estate company. Many of MMA Finance’s projects are in city centers and some, like the Savannah River Landing project, might be regarded as urban renewal or community development projects. Others, however, bear many of the hallmarks of conventional development.

If RainFrog decides to invest in MMA, we will certainly want to keep an eye on the projects funded by MMA Finance. Moreover, we will want to carefully monitor the progress of MMA Sustainable Land Investments. While conservation banking has great potential, it can easily be subject to misuse. It will be imperative that MMA carefully define “sustainabilityâ€

[tucker]

The text below is a press release from MuniMae. The company has announced a dividend cut, and has also announced that it will miss the March 3rd filing deadline set by the NYSE. As a result, the company expects to be delisted. We may wish to weigh this added risk into our investment decision and/or pricing.

I have copied the press release in its entirety.

Press Release Source: Municipal Mortgage & Equity, LLC

MuniMae Announces Quarterly Dividend
Monday January 28, 7:25 pm ET
Provides Update on 2007 Production Numbers and on Restatement Process

BALTIMORE--(BUSINESS WIRE)--Municipal Mortgage & Equity, LLC ( MuniMae or the Company, NYSE: MMA) announced today that its Board of Directors has declared a dividend distribution of $0.33 per common share payable on February 15, 2008 to shareholders of record as of February 5, 2008. The Company also announced that while it expects to have completed by the end of February, its substantive work required to prepare its 2006 financial statements and its restated audited financial statements for 2005 and 2004, the Company does not expect to be able to file its audited financial statements by its previously announced goal of March 3, 2008. Based on work done to date, the Company does not believe the results of the restatement will materially change the previously recorded cash balances of the Company and its subsidiaries.

The reduction in the dividend distribution from $0.5250 to $0.33 per share is due to the cost of the Company’s ongoing restatement of its financial statements, the decision by the Company to conserve capital to protect the long-term prospects of the business given the current volatility in the credit and capital markets, and the desire to dedicate additional capital to the high-growth Renewable Energy Finance business, an increasingly important part of the Company’s business. A portion of this dividend will be paid from sources other than cash generated from operations. The Board of Directors will continue to review the Company’s dividend payout on a quarterly basis based, among other factors, on the Company’s net cash generation and the strategic needs of the business.

“Knowing the importance of the dividend to our shareholders, it was a difficult decision to reduce the dividend,â€

[Guest]

credit stack. MuniMae also has issued or is the guarantor on Credit deault Swaps--presumably on municipalities. These are very hard to put a market valuation on. But if they dont, then FAS 157 says...-marke-em down!