Walter,
<< If the stock price rises above $74.50, it would even be profitable for Sun to buy switches, throw them away, and keep the stock.>>
Said another way, if investors believe ANCR is worth more than $74.50 even without any sales to SUN, SUN would have a very strong financial interest to buy $100,000,000 worth of product to vest their 1.5M shares. These sales should deliver at least $40,000,000 for Ancor to invest in SG&A or retain as profit. SUN would have no financial interest to buy beyond $100,000,000 in product unless the switches were useful to them.
Greg |
