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Technology Stocks : Data Broadcasting Corp. (DBCC)
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To: moby_dick who wrote (4042)1/16/1999 12:23:00 AM
From: P.E. Allen  Read Replies (2) of 5102
 
Would not this same scenario pertain to CBS, who owns 50% of MKWT.

Using your analogy:

CBS = 706,112,000 shares outstanding

DBCC= 32,231,000 shares outstanding

MKWT= 11,750,000 shares outstanding

DBCC scenario says:

11.75 m/shares (divided by) 32.23 m/shares = ONE DBCC SHARE HAS 36.49% INTEREST per 1 MKWT SHARE @ 100.00 % ownership.

CBS scenario says:

11.75 m/shares (divided by) 706.11 m/shares = ONE CBS SHARE HAS 01.66% INTEREST per 1 MKWT SHARE @ 100.00% ownership.

Therefore:

DBCC has 38.0% ownership in MKWT or 36.49% (@100%) x 38.00% = 13.87% interest that DBCC has in one share of MKWT at the market price.

Therefore 100.0% divided by 13.87% = 7.209 shares of DBCC = 1 shares of MKWT.

If MKWT is trading at $100.00 per share, then DBCC should have a theoretical value of ($100.00 divided by 7.209 shares) or $13.87 per share.

Therefore:

CBS has 50.0% ownership in MKWT or 1.66% (@100%) x 50.00% = 0.913 interest that CBS has in one share of MKWT at the market price.

Therefore 100.0% divided by 0.913% = 109.52 shares of CBS = 1 shares of MKWT.

If MKWT is trading at $100.00 per share, then CBS should have a theoretical value of ($100.00 divided by 109.52 shares) or $0.913 per share.

what is wrong with this picture or what variables am I leaving out?

Help: Uncle Ernie!!!!!!!
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