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Strategies & Market Trends : Z Best Place to Talk Stocks

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To: Joseph M. Woody who wrote (47550)	4/4/2003 11:52:01 PM
From: Larry S.	Read Replies (1) of 53068

2:06PM What is Yahoo! going to acquire with new cash? maybe nothing (YHOO) 23.70 -0.64: -- Update -- As reported this morning, Yahoo! raised $750 mln through a convertible bond offering. Salomon Smith Barney believes that terms of the convert are highly favorable to Yahoo! and estimates that new money raises co's cash hoard to roughly $2.3 bln. Firm believes that speculation may immediately run to "What is Yahoo! going to acquire?", but firm believes that may be over-thinking the situation. While it is common practice to speculate about the use of proceeds in such instances, firm thinks this was primarily opportunistic, rather than strategic, on Yahoo!'s part and that it there may not be any immediate ideas in mind. In firm's opinion, this offering was as close to free money as it can recall seeing (convertible into stock at $41, comes due in 2008, and pays no interest). Effectively, Yahoo! sold 18.3 mln shares at $41 per share with no financing or carrying cost outside of underwriting fees. Yahoo!'s mgmt continues to impress firm with its prudent, opportunistic and value-creating oversight of co's capital base and financial structure.

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