Investors in Cityscape breathed a sigh of relief last week when Michael Price of Franklin Mutual Advisors bought options on the company's stock that had been held by Jay Botchman, a promoter whose background and connections have been questioned.

Franklin Mutual has a history of demanding bottom-line performance, and getting results by any means available.

Analysts at Bear, Stearns & Co., Wheat First Butcher Singer, and Natwest Securities renewed their confidence in Cityscape following the announcement that Franklin had purchased the options from Mr. Botchman. If exercised now, the options could be converted into a 14% stake in the company.

Franklin's interest is easily explained, says Ray Garea, senior vice president at the investment firm. "We thought the valuation was pretty attractive, and the management was doing nicely," he said. "One of our guys here came up with the idea (to purchase Mr. Botchman's options.) We thought it might be interesting."

The move does not necessarily mean that Franklin will be looking more carefully at subprime lenders overall, he said.

Mr. Botchman's involvement with the company, and his past history "don't matter to us," Mr. Garea said. "I think that's why the stock was suffering the way it was, and that's why we eliminated his presence."

Mr. Price also has a history of muscling out executives that don't produce. Should Cityscape management be watching their backs? "Don't ask me," Franklin's Mr. Garea said. "We're not on the board, we just made an investment."

Cityscape chief executive Rob Grosser insists that Franklin's potential stake doesn't have him worried. "This management team also has a significant equity position in the company. I believe if we deliver the goods, (Mr. Price) will be a happy, quiet shareholder," he said.

But observers say that happy and quiet are rarely Mr. Price's style. Typically, he will "give a company a short time to get it together," said a lawyer who specializes in bank mergers. "If they stumble, I foresee Price moving aggressively."

The lawyer said Cityscape probably has up to a year to stabilize its stock's performance before the heat is turned up by Franklin and perhaps other investors. "There are several large, aggressive value investors with 2% to 3% stakes in Cityscape stock," he said.

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