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Strategies & Market Trends : Gorilla and King Portfolio Candidates
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To: Mike Buckley who wrote (28723)7/25/2000 12:44:37 PM
From: StockHawk  Read Replies (1) of 54805
 
>>The one issue I don't understand: what portion of Spinco will be sold at the IPO? Qualcomm shareholders will get "remaining" shares, implying that not all of the shares will be sold as part of the IPO. That muddies the issue about the $100 million valuation...<<

That is what normally happens in a spin-off. A small portion of the shares are sold at the IPO, the remainder are retained by the parent. Sometimes (like in this case) the remaining shares are distributed to the parent's shareholders.

As someone stated the $100 mil was just a number thrown out, but do not confuse the value of the IPO with the market capitalization. As example, look at PALM. Twenty three million shares were IPOed. Those shares are available for trading. That is the float. However, 565 million shares are outstanding. To get the market cap you multiply the stock price by the number of shares outstanding, not the float.

StockHawk
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