The following is copied from a stockmaster post. I can't vouch for its accuracy, except to say that nothing I've gotten out of talking to ERAW folks contradicts this stuff, and it is consistent with the UAT-ERAW valuations calculations I gave before.
The reason that UAT was not bought directy by the "merger talks" company had to do with regulatory issues. By acquiring the holding company the regulatory issues would be more managable. The real "merger talks" company last year was BellSouth. BellSouth has business plans to compete in the international market. The deal, subject to regulatory approval, fell through in May 1998 when neither the FCC nor the Australian government agency gave their approval. The ironic part is that another company came in at the end and offered to continue the deal without regulatory approval, basically stealing the deal. BellSouth, through lack of international expertise, decided to bail out instead of carrying the lengthy legal process forward.
There were several conditions, with contingencies placed on the UAT
completion amongst other things. This carry's us up to October, 1998. The
stock began to climb on speculation of the merger's completion. Then
market makers began shorting the stock down, causing delays in
finalization of pending acquisitions. And here we sit. The shorting has
stopped, but everyone's lost faith because they don't know what's going.
This is why I believe that UAT is important. UAT is one of the main
reasons, not the only one. Remember that Dynamic Bell, Australia is
sitting there making money. This gives a company quick inroads into two
large continents. Nice move.
Lately, my guys have been having a hell of a time getting information
about the status of the deal. All of a sudden, ERAW clammed up after
being fairly loose with the lips. Sometimes I really believe that the
present management really doesn't have a clue of what's going on and this
whole thing rests with Nick Flowers.
So in my opinion, after UAT is announced, and the numbers become public,
we will see some excellent movement in the stock. |
