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Technology Stocks : Network Associates (NET)

NET 186.26

-2.7%

Nov 21 9:30 AM EST

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To: mrknowitall who wrote (4297)	3/18/1999 11:37:00 AM
From: Chuzzlewit	of 6021

Mr K, it more be much more underhanded than that. Since, under pooling of interest rules, shareholders of the acquired company get to exchange shares tax free, that effectively lowers the buying price of the acquiring company (since it could always repurchase the additional shares created by the merger). So I don't think that arrangement is necessarily bad for the shareholders (considering the alternative). However, my devious mind looks to the compensation of the top executives. For example, suppose that the top honchos are entitled to x% of the total earnings. Suddenly, as a result of a merger, earnings increase (remember, I'm not talking eps -- I'm talking total earnings) and their compensation individually and as a group increases substantially. I tried to chase this issue down with NETA but was stonewalled. TTFN, CTC

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