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Technology Stocks : Pure Atria Corp(PASW) and Rational(RATL) Merger
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To: Randy Ellingson who wrote (28)4/9/1997 11:05:00 PM
From: seth thomas   of 147
 
Disagree. Plenty of mergers fall apart when the stock goes too low. If I were a PASW director, I would bust this apart, since the buyout of the company is 1/2 of what it was going to be.

If I were a RATL director, I would bust this apart, since it is costing $400MM PLUS the value of the dropped stock, which means the company market cap dropped $1 billion or so. So, this deal is costing shareholders $1.4 BILLION, plus it will cost $100 million or so in real cash to pull these companies together.

It ain't worth $1.5 Billion, guys. RATL would be better off to sell some stock, generate cash, and build a PASW killer product. How long will it take to put back $1.5 billion in shareholder value?

And, the minute a broken deal is announced, RATL will spring back to former levels.
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