Worst Spinoff Of The Year Returns- U.S. Rare Earth TO Spin Off Bio Multimin

We’ll admit it, when we wrote, with more than a little derision, about U.S Rare Earth Minerals'(USMN) planned spinoff of Bio Multimin, we assumed it would slink back into the mud, where it belongs, never to be heard of again.  We were surprised then, to see today, nine months later, that the company not only still existed, but was planning to go ahead with its spin.

When we looked at it last February, this insolvent company was a joke, and the numbers have only gotten worse.  In the most recent quarter, revenue was negative.. Shares outstanding have doubled in the last year. Guess none of that number stuff matters to management though, who called the undisclosed management team of the spun off company “the jackpot”.

USMN shareholders of record on December 31, 2012 will receive one share on BMI for every five USMN shares owned. The shares will be paid out on January 15, 2013. Dennis Cullison, President of USMN stated, “This has been a long awaited announcement and I want to express my thanks to our shareholders for their patience while we searched for qualified management to run BMI. We hit the jackpot with this new team! USMN will soon announce the new Officers and Directors of BMI.”

So, if you enjoy owning stock which will become worthless, we guess this is an easy way to acquire two such stocks in a single transaction. Otherwise, run. Run fast. Run far.  There is no reason whatsoever to own either of these stocks.

Disclosure: The author holds no position in any stock mentioned here. If the author were to walk past a pile of stock certificates from these firms free for the taking, he would keep on walking.