***GSTRF and GlobalstarLP*** Hi Vman! Let's just really labour the point because I guarantee most people still have no idea about the relationship between Globalstar Telecommunications Limited [GSTRF], registered in Bermuda, which people can buy on the Nasdaq exchange and Globalstar LP which you can't buy unless you persuade one of the founding partners or service providers to part with their shares.
GSTRF owns a chunk [about a third for ease of remembering] of Globalstar LP, which will operate the system [paying Loral a fee for doing the actual work] and sell minutes to the service providers who will retail those minutes to all the enthusiastic phone buyers we are reading about.
When Globalstar is operating flat out in 5 or 7 years or so, with 10bn minutes bringing in maybe $3bn revenue, which is about the same as profit since the operating costs are small, GSTRF will get $1bn to divvy up among the shareholders. NOT $3bn.
That's why in the lead in to this thread, I mentioned how people would make a lot less money than they expected if they got the two companies confused.
So, to reiterate, there are TWO companies. Say there are 100m shares in GSTRF in a year or two [with a bit of fund-raising being done even though all the money necessary was raised some time ago and service was supposed to start commercially 15 November 1999]. There are 82m now, [assuming that quoted number is correct though I haven't checked the source lately]. But with the current issue coming up, we'll be heading for 100m shares.
$1bn for 100m shares = $10 a share. Three years ago it was going to be $16 a share, but one thing and another, that number seems to be dwindling.
$10 a share, with a P:E of about 20:1 would give a share price in 5 or 7 years of $200. That's nothing great compared with the mania of the past year or so, but it's better than a poke in the eye with a burnt stick. Of course, we could make it a P:E or 40:1 if we want a higher share price = $400.
Maurice
PS: Incidentally, Mr A said you said Hi! Thanks! |
