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Wolverines’ large investor exits
Firm’s shares tank amid notice

By Eric Fleischauer· 340-2435

When rutabagas and wolverines part company, shareholders lose.

Rutabaga Capital Management gave notice Monday that it had sold all its shares of Wolverine Tube Inc., and shares nose-dived from already historic lows.

Trading on the Pink Sheets, Wolverine closed Tuesday at 77 cents, down one-third from its closing the previous week.

Rutabaga bought 1 million shares — about 7 percent — of Wolverine’s stock in late 2004 when shares were hovering around $10. It upped its ownership to 11 percent in May 2005 when shares were about $7. Rutabaga is so named because its director specializes in “unearthing rutabagas,” finding struggling companies with value beneath the surface. Wolverine’s value, apparently, was buried too deep.

Wolverine, which manufactures copper tubing, has been overwhelmed by escalating copper prices. It engaged Rothschild Inc., the same company Delphi Corp. retained in advance of its bankruptcy, in early 2006 to coordinate a restructuring, which eventually led to the sale of facilities in Quebec and Tennessee.

Shares dropped precipitously in November when Wolverine, which employs 500 in Decatur, suggested it was considering a reorganization bankruptcy as a way to escape its mounting debt. That drop ultimately pushed Wolverine’s market capitalization below $25 million, the minimum for companies listed on the New York Stock Exchange. It was delisted the first week of January.

At its initial offering in 1993, Wolverine shares sold at over $16. They broke $40 in 1996 and again in 1999, but since then have trended downward. Wolverine had net losses per share of $1.63 in 2001; $3.31 in 2003; $2.57 in 2005, and, in the first three quarters of 2006, $3.01. It had per-share earnings in 2002 of 45 cents and in 2004 of 3 cents.

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