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Biotech / Medical : Arterial Vascular Engineering AVEI

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To: mmeggs who wrote (391)	10/29/1998 10:58:00 AM
From: Dave Chanoux	Read Replies (1) of 410

Reverting to higher math: I think about the Bard transaction this way. Case I: Before Bard (BB) AVEI has X in cash and marketable securities which produces income Y. Y goes to the income statement contributing to earnings. I don't know how much Y is. Case II: After Bard (AB) AVEI has X-600 in cash which produces income Y-Z. We could argue about what Y-Z is but I think that is secondary. The line of credit is at Prime + or about 8% today (as I read the 10K). AVEI must have drawn some on the L of C at 8% to make the Bard purchase. Using cash on hand just reduces the Y. Give or take a few million, the income statement is short $.80 per share per year, assuming no income from Bard. Of course, one would expect they could generate something from Bard. Any income above about $48 million increases EPS. Regards, Dave Chanoux

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