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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 227.35

+0.3%

Dec 19 9:30 AM EST

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To: H James Morris who wrote (3899)	5/4/1998 10:06:00 AM
From: Oeconomicus	Read Replies (1) of 164684

Winter it appears that your not up-to-date. Last Mon, Amzn announced the acquisitions of 3 internet Co's, paid mostly with stock. They plan a secondary offering, after they sell their junk bonds. Jim, I don't think the total consideration for these acquisitions has been disclosed, so we don't know that the total was "mostly stock". Furthermore, at least one of the three was totally cash. As for a secondary, the view of WS seems to be that the note issue is in lieu of a secondary. Analysts were quoted in the WSJ saying that management doesn't want to part with any of it's ownership - that is, they don't want to be diluted. More likely, they concluded that a secondary would bring the stock down while a successful junk issue wouldn't, especially since they won't have to disclose the terms probably until their Q2 10-q comes out in August. Funny that the spin implies they are issuing debt because they think the stock is undervalued. My read is that they know a secondary would prove it is overvalued and think the debt issue will buy them more time (to figure out how to turn a profit, for the bubble to grow, or for them to sell more of their own stock - you pick). Bob

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