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Technology Stocks : IDT *(idtc) following this new issue?*
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To: Andrew H who wrote (10198)6/28/1999 11:09:00 PM
From: peter michaelson  Read Replies (3) of 30916
 
Andrew:

I think there are some errors in your post.

First, the IPO will not bring $67 million to IDTC. The seller is Net2Phone, and Net2Phone will get the $67 million.

Second, normally a discount should be applied to the value of a large holding in apublic company - for 2 reasons. One, there would be a taxable capital gain if the holding were to be sold. Second, the holding is not liquid - it cannot be sold off without lowering the price. Therefore, it's not worth 100 cents on the dollar.

Typically, 70% of the public stock price is used as an approximation for the value to the parent.

peter

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