Mark,
I was just quoting from Seagates PR release: <<Based on the closing stock price of VERITAS Software on May 28, 1999, the value of the shares to be received by Seagate Technology is approximately $3.1 billion.>> It is plausible that it will appear under "Cash and Marketable Securities". However, once a company owns a certain percentage of another company, they account for it in a different way. That may require majority ownership, however, I don't know.
Yes, that is the flaw with this way of looking these things. Don't know if you ever followed Petrie Stores or not, they were a fairly good sized retail chain whose real claim to fame was that they were an early and large investor in Toys R Us. For years, analysts would recommend the stock because it was trading at a discount to their TOY shares, so you not only got the company itself for free, you even got TOY shares at a discount when TOY was a great stock to own. However, the stock continued to languish for years despite TOY's wonderful record. Eventually, Petrie went out of business, I think in the early 90s but am not sure, I think they distributed the stock to their shareholders, maybe someone else recalls for sure? The only company whose stock went up when they announced bankruptcy! |
