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Technology Stocks : WCOM

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To: P.T.Burnem who wrote (5763)1/21/2000 2:24:00 PM
From: MGV  Read Replies (1) of 11568
 
I think I do. Its arbitrage based on the collar in place for the deal. The lower bound of the collar is $40. At the lower bound, Sprint shareholders get more WCOM. There is an incentive to buy FON and simultaneously sell WCOM - at least until the WCOM price gets to $40. If it were to fall significantly below that, both FON and WCOM would lose.
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