Floorless Preferred Stock/Debenture Message Board

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Strategies & Market Trends : Floorless Preferred Stock/Debenture

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To: RockyBalboa who wrote (1236)	9/29/2000 10:00:55 PM
From: Zeev Hed	Read Replies (1) of 1438

Info, first, MSFT has pocketed a sizeable premium for these puts, and MSFT has been selling these puts for years to lower it cost of acquisition of its own shares. They have made much more than $3.2 B on such transactions over the year. So now, they pay back some ot it. Some of these puts have already expired in June. Nut even if you assume that MSFT will be at $0 and thus MSFT's liability is at most $12.5 B, well they have some $23 B in their coffer and could buy these with that cash. Frankly, MSFT book value is still under $10/share, and anytime they sell stock above that book value, they increase the book value of all share. Thus, unless the stock goes under book, what is the problem? Zeev

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