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Technology Stocks : Newbridge Networks
NN 17.26+2.9%Dec 22 3:59 PM EST
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To: fumble who wrote (13667)10/15/1999 2:41:00 PM
From: Serge Collins  Read Replies (2) of 18016
 
All this talk about share exchange formulas begs the question -- why did Newbridge management decide to make a relatively small takeover using a share exchange instead of buying the company outright with cash? There are no regulatory hurdles preventing them from buying Stanford with a cash tender offer. I know some will say that this is the way it's done with most takeovers, but most takeovers in technology involve much bigger plays where the outlay of cash would make that prohibitive. In this case Newbridge had more than sufficient cash on hand to do it. It could have avoided much trouble, uncertainty and further dilution. What they chose instead was a somewhat complicated exchange formula, and a formula that lends itself well to manipulation. If they wanted to buy Stanford with a share exchange, they should have made it a clear and precise exchange with a clearly defined exchange price.

Instead they have allowed their stock to fall prey to manipulators (arbitrageurs) and left their long-suffering shareholders to twist in the wind yet again.

This is yet another example of poor management thinking. Nothing this management team does is well thought out. However, one thing they do extremely well is find ways to make money for Terry Matthews through his I'm-Rich-And-Getting-Richer-With-These-Affiliates Program.

Please, I know everyone here loves Terry, but can we dispense with the apologies on this one. Just this one time.

Thank you and have a good weekend.
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