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Strategies & Market Trends : Z Best Place to Talk Stocks

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To: Joe Stocks who wrote (43535)	9/19/2002 2:58:39 PM
From: DanZ	Read Replies (1) of 53068

No, the spin-off won't affect the float at all. Here's an example of what would occur based on the prices of both stocks right now. Share price of RRI: 3.57 Each share of REI is entitled to about 0.8 * 3.57 of RRI = value of $2.86 Share price of REI before the spin-off: 10.60 Share price of REI after the spin-off: 10.60 -2.86 = 7.74 REI shareholders would receive RRI stock worth 2.86 Total value of their holdings = 7.74 + 2.86 = 10.60 REI will simply distribute their existing shares of RRI to their Shareholders. The float in RRI will NOT increase. The share price of REI will decrease because you have to add the value of the RRI shares to obtain the total value. Of course, the prices of the stocks will trade on their own accord, so these figures are not absolute. For example, if REI is up 50 cents on its own the day of the spin-off, the stock would trade at 8.24 after the spin-off. PS: I love you too, man...sometimes. lol

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