Today, Nexia Holdings, Inc.’s CEO Richard Surber shared his thoughts regarding current economic issues and the opportunities available to the company. Below we have copied his letter to Nexia shareholders.
Dear Shareholders:
Over the past few months I have been tuning into many financial news programs, financial blogs historical documentaries and reading as much as I can. This is in an effort to figure out how to take advantage of the tremendous bargains that are becoming available in today’s marketplace. Nexia, like many other companies, has limited cash and very little available credit. Nexia is relatively small and our team has done a good job at slashing overhead. Our staff is battle hardened and seasoned as a result of the struggle of getting the company to where it is today. I do not subscribe to all of the doom and gloom. In fact, I believe that 2009 is going to be a tremendous year for our tough little company.
I recently tuned into a video interview of AIG’s former CEO, Hank Greenberg, by Neil Cavuto. The gist of the interview was that Greenberg believed that current management of AIG is recklessly giving away assets and that AIG should be acquiring assets now rather than giving them away. I agree with Greenberg as he has been around long enough to have seen it all. He built AIG into the largest insurer in the world. AIG has received billions from the government and should be sitting tight right now and expanding at all cost in anticipation of the inevitable recovery.
I want shareholders of Nexia to know that we are making every effort and using every resource to buy assets, namely real estate, with a long term view. It is my belief that Nexia’s strategy of using its speculative securities to buy up what other people are fearfully giving away is key to growing Nexia into a major concern after the dust settles from the current economic downturn. The strategy is risky but sitting on the sidelines and doing nothing is simply not an option when there are an abundance of opportunities.
By the end of the January, Nexia could very well hold title to as many as 20 residential properties and 19 development parcels of lands in Northern Utah. The debt on these prospective properties is about equal to their value at just under $3M. If Nexia is able to carry out these plans, shareholders could be looking at owning a stake in a company that has in excess of $100M in assets in a short period of time by using its equity and the assumption of debt to acquire the properties.
The end result could be a situation where the equity is then used to pay down the underlying mortgages leaving Nexia holding properties debt free in as little as 24 months, provided Nexia has the liquidity in its market to accomplish its lofty goals.
I hope this short letter provides some additional insight into the direction we are taking Nexia in 2009.
Sincerely,
Richard Surber, CEO
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