RE: Cash from Warrant Exercises?
Jeff,
>> 150 million shares outstanding minus the $180 million in cash that the warrant excersize would bring in. You could use that cash to buy back about 50 million shares <<
Good point, but be careful that you don't overestimate the amount. SyQuest is having a hard time getting the venture capitalists to exercise their warrants:
Management may have to entice existing warrant holders to exercise their warrants by offering discounts to the contractual exercise price and/or issuing exchange warrants at market or negotiated discount exercise prices
Also, you can expect a lot more bleeding before it's done. Whatever cash they are able to get from the warrants, expect it to be used to repay loans, finance product ramping, finance advertising, finance price wars, finance legal battles, etc.
I think it's safe to say that you won't see any stock buybacks from SyQuest, much less the 50 million share buyback that you're proposing.
- Michael Coley
- i1.net |
