Seagate Technology - Fundamentals Message Board

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Technology Stocks : Seagate Technology - Fundamentals

STX 286.22

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Dec 26 9:30 AM EST

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To: Struggling Investor who wrote (1784)	4/22/2000 7:50:00 PM
From: Mark Madden	Read Replies (1) of 1989

Trish - Thank you for putting the research together. I have not caught up to the implications yet but I will get there. I interpreted the deal to mean VRTS would purchase SEG to include the gain from the operations sale to SL, the securities (including SNDK), all cash after debt payment except the 800M to SL for operations and the VRTS stock. The stockholders would receive $5 plus 80% of their own VRTS stock. Two things bothered me about the deal. First, the sale of operations to SL for $2B. Second, the cash valued at $1.35B billion over $5 per SEG share by SSB and the securities valued at $1.6B were being sold to VRTS for $5 per share. In other words VRTS was getting $18.7 (($1.35B +$1.6B)/215 SEG shares + $5)per share of cash and securities owned by SEG shareholders for $5. The changes in prices have changed the security values but the principals remain the same. Why should the BOD consider selling $18.7 of value to VRTS for $5 to the shareholders. It seems strange SEG is selling stock that was part of the deal. Maybe they have VRTS permission because it makes no difference to VRTS if they receive stock or cash from the deal. If stockholders approve the deal they get $5 per share anyway. Regards, Mark

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