John Paul, Aren't you the tax expert? Could you please explain the tax situation on this? Is there a double taxation, company pays first and then we? This may be the reason like coopie is mentioning for this poor price action. I don't like this sale structure any bit at all and will vote no, as if it matters. Looks like AB did it on purpose to tease the board for throwing him out. They should have sold it all to HLIT and then HLIT could have divested the semi side.
C-Cube Announces Agreement to Combine DiviCom with Harmonic
Combination Creates Premier Provider of Open-Systems Solutions for Delivering Video, Voice and Data over Broadband Networks
Milpitas, California - Oct. 27, 1999 -- C-Cube Microsystems (Nasdaq:CUBE) today announced that it has entered into a definitive agreement to combine its wholly-owned DiviCom subsidiary with Harmonic (Nasdaq:HLIT), and to spin off or sell its semiconductor business in a taxable transaction prior to the closing of the transaction. DiviCom is the leading provider of open solutions for digital television.
Under the terms of the agreement between C-Cube and Harmonic, the Harmonic transaction will be structured as a tax-free exchange of stock in which C-Cube shareholders will receive, in exchange for each share of C-Cube stock, 0.5427 shares of Harmonic stock. Based upon Harmonic's closing price of $64.875 on October 26, 1999, the value of the Harmonic combination would be approximately $1.7 billion. In addition, the C-Cube shareholders will receive spun off shares of the semiconductor business or net, after-tax proceeds of any sale of the semiconductor business.
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