Corrections Corop. of America board member and metals industry executive John Correnti was found dead at his home earlier this week. He was 68. In a filing with the Securities and Exchange Commission, CCA said Correnti — who had served on the prison management company's board since 2000 — will be greatly missed. There's no word yet on who will fill his board seat.
The board of directors of Corrections Corp. of America last week voted to revise its committee structure to focus more cleanly on risk assessment and risk management. Directors agreed to set up a new risk committee, carving its responsibilities out of the audit and risk committee. The new subgroup has as members Thurgood Marshall Jr. — who will chair the committee — as well as Donna Alvarado, Anne Mariucci and Charles Overby.
In a filing with the Securities and Exchange Commission, CCA said the new committee will help coordinate the prison management company’s risk assessment and risk management practices as well as its legal, regulatory and contract compliance.
“The Risk Committee will also review issues and trends facing the company that could impact the company’s business operations and public reputation,” according to the filing.
In part because of the nature of their business, CCA and its prison operator peers regularly have to handle sticky situations involving inmates’ living conditions and other issues. In May, Department of Justice officials said they would not press charges related to some Idaho employees falsifying staffing reports. More recently, the Tennessee Bureau of Investigation began looking into accusations that several Nashville-area CCA employees sold woodwork made by inmates.
Shares of CCA (Ticker: CXW) ended Tuesday trading at $31.68. So far this year, they’ve fallen about 13 percent.
Corrections Corp. of America Chief Development Officer Anthony Grande has joined the ranks of local executives posting big insider sales. The 45-year-old executive, who has been with Nashville-based CCA since 2003, this week twice unloaded 10,000 shares for more than $650,000. The moves trimmed Grande's CCA holdings by about 18 percent.
Prison health care provider Corizon has hired Chris Bell to lead its business development efforts across the Southeast. Bell, who worked with Corizon from 2007 to 2009, had been with Birmingham-based competitor NaphCare. He fills a role previously held by Martha Harbin, who has been named Corizon's first director of external relations. Get more info here.
Corrections Corp. of America executives this week amended their main revolving debt facility, extending its maturity date by two and a half years to mid-2020 and lowering by 25 basis points the margin on its base rate and LIBOR rate loans, among other things. The amendment also boosts the company's "accordion" feature by $250 million to $350 million. CCA shares (Ticker: CXW) are up slightly this morning to $34.66. Year to date, they've slipped about 5 percent.
Technical analyst Garrett Patten says he doesn't see much more upside in shares of Cracker Barrel Old Country Store, which have gained 5 percent (Ticker: CBRL) so far in 2015. The stock has in recent years dipped steeply after rising well above its 200-day moving average, he writes, and it could well be on its way to repeating that pattern.
This year alone saw two instances of this behavior, at the January and March highs, which deviated from the 200-day SMA 25.5% and 26.5% respectively. While price is currently only 11% from the 200-day SMA, the technical strength behind each subsequent rally has been steadily deteriorating.
Private prison operators are no strangers to controversy or to being the targets of protests. The latest chapter of that book was written Monday, when the trustees of Columbia University announced that the school's $9 billion-plus endowment will divest itself of private prison companies, including Corrections Corp. of America (Ticker: CXW). Shelly Banjo at Quartz has more here.
Analysts at Moody's Investors Service have hiked their rating on the debt of Corrections Corp. of America by a notch, saying the company is well placed to fill empty beds at its prisons and steadily grow its network of facilities without having to do much to its balance sheet.
Upward rating movement will be predicated upon continued growth in gross assets – providing improved access to capital and consistent operating results. Continued demonstration of positive revenue growth, operating margin and earnings trends coupled with steady leverage and coverage ratios are also key drivers for positive rating momentum.
It's beginning to look a lot like prison health care company Corizon will not get an extension to its $130 million-a-year contract with New York City officials when the deal expires at the end of this year. The Brentwood-based company has been under fire in the Big Apple over the quality of its care and its hiring practices. Sources have told The New York Times that the city's public hospitals entity is prepared to take over operation of sites now under the care of Corizon.
In the next few weeks, the Department of Investigation is expected to release a damning report that will criticize Corizon for failing to properly screen the health care workers it hires and will suggest it may have contributed to injuries and fatalities at the jail, according to one of the two city officials.
The U.S. Department of Justice will not press criminal fraud charges against Corrections Corp. of America in connection with its operation of the Idaho Correctional Center, where employees falsified staffing records. An FBI investigation found that some lower-level workers had covered up chronic understaffing problems at the prison, which also has been the subject of litigation from inmates alleging poor conditions.
Olson said the review showed that some Corrections Corporation of America employees falsified staffing reports, but they were relatively low-level workers. No one at the assistant warden position or higher was aware of the fraud at the time it was committed, the investigation found.
Additionally, she said, the employees responsible for billing didn't know about the false reports, and since the prison company was paid based on number of inmates — not number of guards — there wasn't direct evidence that the fraud was intended for financial gain.
POSTDATA: WARRANTY DEEDS