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Strategies & Market Trends : HOT STOCKS 100% 200% 300% profits possible short term

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To: Ron logo who wrote (1677)	3/18/1999 1:21:00 AM
From: hoffy	of 2038

ALMI news "ALPHA MICROSYSTEMS hired a second investment banker to help maximize the value of the company's "AlphaConnect" technology. Salomon Smith Barney, which came onboard in January, will continue to look for an outright buyer. The new (unidentified) firm will focus on creating a spinoff, probably majority-owned by ALPHA. The remainder of the spinoff's funding, if that alternative is pursued, is likely to be provided by a private equity placement. The addition of a second banker should give Salomon Smith Barney greater leverage in its pursuit of an outright sale. Inadequate offers reasonably can be refused now, in light of the tangible alternative provided by the spinoff option. The extra negotiating leverage should enable ALPHA to extract the highest possible price for "AlphaConnect" in a direct sale. That approach still offers the greatest long-term return to shareholders. A spinoff would involve a far longer payback cycle. Risk also would be a substantial factor. We continue to value a direct selloff of "AlphaConnect" in the $6.00-$9.00 a share range. We also estimate the company's remaining service business to currently be worth about $3.00 a share. Spirited bidding for the technology could lead to a higher price. A final resolution should be reached within the next two months."

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