Hi Jack,
It's been public knowledge (according to the 4/7/2000 secondary prospectus) that about 90-100 million shares are approaching the end of the lockup. That's been a given for quite some time (this info is free via "ipolockup.com"; and paid research has noted this info on a regular basis) beginning 6/16/2000 (which is 70 days after the secondary, and then additional shares 110 days after the secondary).
My only concern is that after the secondary the executive officers and directors controlled a 45% stake in Finisar. (This does not include a 6.36% stake controlled by Margaret Rawls, and a 3.0% controlled by Rawls Holdings - these are after secondary percentages.)
My concerns are based on the following:
1) the company missed their gross margins, and had a very reasonable explanation for the miss (circuit boards)
2) the company is anticipated to have extremely high growth for the coming year, and ML increased revenues/earnings going forward
3) Jerry and the CFO recently gave internet interviews discussing the merits of the company
Is the company going to unload (diversify would be a polite word!) shares on the market, or what is their intention? My thoughts have been that 1) they want a strong price for possible acquisitions and to recruit employees, 2) they (management) would not have split 3:1 if they were going to unload shares to decrease the stock price to the single digit level, 3) the company is in one of the hottest sectors in the market, and 4) the company has a desire to have the price move above the secondary pricing level.
Please excuse my crudeness, but I'm hoping the old saying "Don't tell me it's raining while you are p***ing down my leg" doesn't apply with their intentions.
I'm hoping the company's gross margin explanation was accurate, management does not want the stock to further decline, and that the recent internet media appearances (by Jerry & the CFO) were for the benefit of current shareholders, and not so that management could diversity into the open market.
Just my opinions and my concerns,
It wouldn't be a surprise either way as on page 7 of the 4/7/2000 secondary prospectus, it states "Substantial numbers of shares of our common stock will become available for sale in the public market simultaneously, which could cause the market price of our stock to decline".
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