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Technology Stocks : Intermedia Communications ICIX
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To: fastcats who wrote (287)12/20/2000 9:50:02 PM
From: Vahe   of 313
 
fastcats,

It is true the merger agreement says that if the exchange ratio obtained by dividing the 39 by the WCOM share price is greater than 1.0685 then WCOM may elect to offer 1.0685 share of WCOM + (at most (1.1872-1.0685)=.1187 if WCOM share price is less than 32.9, and at least 0 if WCOM share price is 36.5)x (average volume weighted price of the WCOM stock for 15 random trading days selected from previous 30 consecutive trading days).

The bets are that WCOM share price will be less than 32.9. In that case the cash value assuming WCOM average weighted price is between 10 and 30 will be between $1.2 and $3.5

So for each ICIX share you get 1.0685 of WCOM share + range of $1.2 to $3.5.

Of course if you want to you can use the cash to buy back WCOM shares at market price bringing your ratio back to 1.1872 if the share price is the same as the volume weighted average price.

Vahe
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