Earnings dilution? Doesn't look like it.
Carmine,
According to the S-3, after the offering there will be 75,581,184 shares outstanding. In the 1Q98 earnings release, GAC reported EPS of $0.54 on about $40.5 million net income. Dividing EPS into net income I find that the number of shares used in the calculation was ~75,000,000.
The only thing I can figure is that these shares have always been included in the 'shares outstanding,' and that the S-3 is being filed only because the shares included in the offering are now going to be issued and released into the general market for the first time (thus increasing the float).
It strikes me as a little strange, too; but, that's the way I read it.
As for the use of the proceeds, I quote the S-3 section entitled USE OF PROCEEDS: "The Company will not receive any of the proceeds from the sale of shares of Common Stock by the Selling Stockholders. In connection with the Offerings, certain current and former directors and employees of, and advisors to, the Company are expected to exercise stock options to purchase, in the aggregate, approximately 2,911,077 shares of Common Stock from the Company for an aggregate exercise price of approximately $28.7 million; all of such shares are expected to be sold by such Selling Stockholders in the Offerings. The Company intends to use the proceeds of such option exercises for general corporate purposes."
You can find the filing through:
fe.freeedgar.com
Regards,
Creighton |
