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Non-Tech : DaisyTek (DZTK) Nasdaq

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To: Tom Hua who wrote (9)	11/24/1999 11:23:00 PM
From: Glenn Petersen	Read Replies (2) of 19

PFSW is scheduled for next week. I don't think that the IPO is going to do that well and DZTK, which closed at 19 3/8 on Friday, looks very vulnerable at this level. DZTK will be holding 14.305 MM shares of PFSW after the IPO. That works out to .83 PFSW shares for each of the 17,173,952 DZTK that are currently outstanding. The PFSW IPO is currently priced at $12 to $14 per share. Assume it pops to $20 per share, which I think is rather generous. That gives you a gross value of $16.60 per DZTK share. Discount that by 45% and you are left with $9.13 per share. DZTK closed at 11 1/4 on September 23, 1999, the day before PFSW filed its initial S-1. DZTK closed at 12 3/4 the next day. For the six months ending September 30, 1999, PFSW accounted for approximately 13.1% of DZTK's sales ($62.8 MM out of $479.9 MM). If we allocate the pre-filing valuation by the sales figures, the core business of DZTK is worth approximately $9.78 (11.25 times .869). Add the $9.13 to the $9.78 and you have $18.91. But you already knew that. :) Hopefully it pops a couple of more points before the IPO.

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