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Strategies & Market Trends : Arbitrage Plays -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (57)	10/5/1999 10:41:00 PM
From: Xpiderman	Respond to of 376

Great Arbitrage Opportunities The WCOM/FON merger term is: "The transaction, including the acquisition of Sprint's main phone business and its PCS wireless business, is valued at $76 a share. So long as the stock stays between $62.15 and $80.85 a share. MCI WorldCom will issue between 0.94 share and 1.2228 shares in MCI WorldCom stock for each Sprint share. In addition, the holders of PCS shares, which trade as a so-called tracking stock, will receive tracking stock in MCI WorldCom plus 0.1547 share of MCI WorldCom stock. In addition, MCI WorldCom will assume $14 billion in debt and preferred stock." wcom.com WCOM WCOM:FON FON $99.00 0.9400:1 $93.06 $98.00 0.9400:1 $92.12 $97.00 0.9400:1 $91.18 $96.00 0.9400:1 $90.24 $95.00 0.9400:1 $89.30 $94.00 0.9400:1 $88.36 $93.00 0.9400:1 $87.42 $92.00 0.9400:1 $86.48 $91.00 0.9400:1 $85.54 $90.00 0.9400:1 $84.60 $89.00 0.9400:1 $83.66 $88.00 0.9400:1 $82.72 $87.00 0.9400:1 $81.78 $86.00 0.9400:1 $80.84 $85.00 0.9400:1 $79.90 $84.00 0.9400:1 $78.96 $83.00 0.9400:1 $78.02 $82.00 0.9400:1 $77.08 $81.00 0.9400:1 $76.14 $80.00 0.9500:1 $76.00 $79.00 0.9620:1 $76.00 $78.00 0.9744:1 $76.00 $77.00 0.9870:1 $76.00 $76.00 1.0000:1 $76.00 $75.00 1.0133:1 $76.00 $74.00 1.0270:1 $76.00 $73.00 1.0411:1 $76.00 $72.00 1.0556:1 $76.00 $71.00 1.0704:1 $76.00 $70.00 1.0857:1 $76.00 $69.00 1.1014:1 $76.00 $68.00 1.1176:1 $76.00 $67.00 1.1343:1 $76.00 $66.00 1.1515:1 $76.00 $65.00 1.1692:1 $76.00 $64.00 1.1875:1 $76.00 $63.00 1.2063:1 $76.00 $62.00 1.2228:1 $75.81 $61.00 1.2228:1 $74.59 $60.00 1.2228:1 $73.37 $59.00 1.2228:1 $72.15 $58.00 1.2228:1 $70.92 $57.00 1.2228:1 $69.70 $56.00 1.2228:1 $68.48 $55.00 1.2228:1 $67.25 $54.00 1.2228:1 $66.03 $53.00 1.2228:1 $64.81 $52.00 1.2228:1 $63.59 $51.00 1.2228:1 $62.36 $50.00 1.2228:1 $61.14

To: Paul Senior who wrote (57)	10/6/1999 2:27:00 PM
From: Paul Senior	Read Replies (3) \| Respond to of 376

Arrgh. Problems, problems. Always a deal that doesn't work out. I've got two now: KRSL: They found an environmental problem that may or may not be covered by insurance and may or may not be more expensive than currently estimated. KRSL is a dinky company, so it might be material to the deal. Meanwhile, there's only a letter of intent by the acquiring firm. So it's easy for acquirer to back out or renegotiate. Stock is down from 10+ to 7. CAST: Acquiring firm can't get financing apparently. Merger now delayed as CAST board decides to meet to ponder next steps. Stock drops from 16 to 11 (so far today). Takeout was to be at $18.10 I expect some deals not to work out. I just don't have enough experience yet to factor in my loss rate. And I haven't figured out a good strategy for me. Rather than take losses now on these two, I'll try to hold on a bit longer to see what develops. But of course that lowers the yield (time factor of money)as well as having the possibility of a slowly declining stock price and/or a lowered takeout price.