SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : Align-Rite Int'l (MASK) Undervalued compared to PLAB DPMI
PLAB 23.26+2.8%3:59 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: PAR who wrote (349)9/21/1999 9:32:00 AM
From: Carl R.  Read Replies (1) of 388
 
Actually a falling PLAB would be good for MASK holders because we would still get $23 worth of PLAB, and if PLAB were cheaper we'd get more shares. Similarly a rising PLAB is bad because we get less shares, although they are worth the same dollars.

Like you I can't figure out why MASK is only at $19 instead of say $22. Perhaps one reason is that the structure of the deal prevents arbitrage. If there were a fixed conversion ratio an arbitrager could buy MASK and sell an offsetting amount of PLAB, but because only the price of MASK is fixed you can't do that.

Even without arbitrage, if people weren't selling here the price would rise closer to $23. Part of the reason for the discount is probably that the merger is a ways off. By the way, do you know when it is supposed to happen? Presumably there is also some doubt over whether it will actually happen.

Considering the EPS of MASK, a merger with MASK at a price even as high as $30 would have been good for either PLAB or DPMI. In some cases like this the stock actually moves up above the proposed merger price as the company becomes "in play". Here no one really seems to care. But after all, that is the way MASK has traded for as long as I've followed it, so I don't know why I should be surprised.

Carl
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News