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Technology Stocks : Primestar/TCI Satellite (TSATA)
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To: judge who wrote (220)1/22/1999 1:10:00 PM
From: J.S.  Read Replies (1) of 442
 
"tempo to get 465 million.. which tsata owns.. it looks like tsata to recieve over 500
million.. share price of around 8 bucks... I've got to be figuring this out incorrectly..."

As the market is demonstrating, it is not 8 dollars. The reason is simple. While TSAT owns Tempo which owns the satellite assets formally, they owe Primestar Inc approximately the same amount that
the satellite is worth (See Q3 10Q note 9). It is essentially fully
mortgaged.

The best way to understand this is to compare this to selling a house
for 50K on which the outstanding principal is 50k. You get the 50K
which immediately goes to your lender. It is not exactly this, but
essentially so. So that sale is a wash for tsata owners. However, there is the second transaction which involves the sale of of the DBS business. TSAT gets 67M or so.

Bottom line: TSAT a is holding company with 67M in cash and marketable security assets minus some legal accounting and
adminstrative fees needed to do the mopping up (and helping the lawyers accountants etc make their living). This leaves about $1 for
tsata holders depending on the status of tsatb shares.

The business press has been partly responsible for all the disinformation. They could have gotten some reliable sources to
clarify these issues early on instead of relying on information
gleaned from internet message boards, especially concerning such
a complex set of issues.

The business press both print and and broadcast often blames the
internet for these things, however they themselves seem to contribute
as much or more to this nonsense.

Good Luck,
Joe
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