Seagate Technology - Fundamentals Message Board

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Technology Stocks : Seagate Technology - Fundamentals

STX 275.32

-1.7%

Dec 31 3:59 PM EST

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To: Stitch who wrote (1793)	4/24/2000 2:31:00 PM
From: Robert Douglas	Read Replies (1) of 1989

My take on arbitrage, short VRTS, long SEG. Possibilities. 1. Deal goes through. You make the arbitrage profit. Nice return, all short term gains. 2. Deal is renegotiated. Seagate goes up and possibly VRTS goes down. Wonderful for the arb. 3. Deal falls apart. Worst case: Seagate drops because non-taxable exit from VRTS is gone. VRTS rises due to perception that less stock will hit open market. Best case: Seagate rises because core business is worth more than $5. VRTS falls because they are losing app. $2 billion in value that they would have realized. Cover VRTS short and keep Seagate long for an investment.

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