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Non-Tech : The New Iomega '2000' Discussion Group
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To: D.J.Smyth who wrote (4927)7/19/2001 4:24:14 PM
From: D.J.Smyth  Read Replies (2) of 5023
 
"The Company also announced that its Board of Directors has approved, and will recommend to the Company's shareholders for their approval, a one-for-five reverse stock split of the Company's outstanding shares of common stock. A special meeting of shareholders will be convened to obtain approval for the reverse stock split. If the reverse stock split is implemented, every five outstanding shares of common stock will be automatically changed into one share of common stock, thereby reducing approximately 273 million shares of common stock currently outstanding to approximately 55 million shares.

David Dunn, Chairman of Iomega's Board of Directors, said the Board is recommending the reverse stock split for several reasons:

* To encourage greater investor interest in the Company's common stock by
making the stock price more attractive to the many investors,
particularly institutional investors, who refrain from investing in
stocks that trade below $5 per share;

* To reduce trading fees and commissions incurred by shareholders, since
these costs are based to a significant extent on the number of shares
traded; and

* To enable the Company to focus on restructuring its business in the
long-term best interests of shareholders"

This man is an idiot. The only thing that will increase shareholder value is if they increase sales. He doesn't want to get bumped off the NYSE. But, the shareholders will approve this measure. Since the shorts would like to see this happen, to be a contrarian, I'll say it will cramp supply of the stock and actually create short covering. I told you the BOD was going for a 4 to 1. Dunn puts the icing on the cake with a 5 to 1. Why not make it 50 to 1?
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