Zitel-ZITL What's Happening Message Board

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Technology Stocks : Zitel-ZITL What's Happening

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To: M. Frank Greiffenstein who wrote (1295)	11/29/1996 11:12:00 PM
From: dppl	of 18263

Hello Doc, I've posted this question before and never got a good answer from anyone - not that I'm implying you should know - but why did MATR sell to ZITL and the Texas company for such a small amount when they had such a hot product? I have been involved in several start-ups and have negotiated with investment bankers, and to me it is incomprehensible that MATR did not negotiate better terms - hugely better terms. In fact they must be pretty pissed off right now. They can't even afford to buy much ZITL stock with what they were paid. (From Barron's): >Last week, Dallas-based BRC Holdings, a provider of data-processing systems with which MadriDigm has an existing sales and marketing agreement, announced the purchase of $1.5 million of MadriDigm shares. The buyer noted in a press release that its investment constitutes "approximately 7% of the current outstanding equity" of MadriDigm. Let's do the math: If a $1.5 million stake equals 7%, BRC's private-market investment ascribes to MadriDigm a total value of $21.4 million. So, why are Zitel's public holders willing to value the same company at roughly 20 times that amount? Something doesn't compute.>> ZITL Thomas

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