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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 165.07-1.0%Nov 18 3:59 PM EST
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To: JGoren who wrote (25433)3/29/1999 2:05:00 AM
From: John Stichnoth  Read Replies (1) of 152472
 
JG, I think I'll be showing some ignorance here, but I was fairly pursuaded by what Jon K wrote. The pressure on institutional holders to tender in the face of a bid is enormous--especially if their holdings are a significant portion of their portfolio. If an offer was made today for Q at $150, the shares would of course immediately jump to that price. The money manager would have to report a value of $150 at month end. (Great for last quarter). But, if the tender is rejected, there is a real possibility that the market value will fall to its previous level--say $111. Come June 30, the manager's going to have to report that as part of his results.

To say that a manager is not going to tender in the face of those second quarter results denies the enormous pressure he is under to provide short term gains.

And here's some ignorance: Are you implying that there are some countervailing pressures/regulations that might prevent or at least dissuade a manager from selling into a tender offer?

I should add here that I hope and plan to be a long time Q holder. I do not want someone coming in. Unlike Maurice I have not set my sights on 200 in 2000. If Q were to increase earnings 30% per year for the next few years that would be fine by me. Any multiple expansion would be gravy, but not necessary to keep me happy with my investment.

Best,
JS
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