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Non-Tech : Knight/Trimark Group, Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Bob Kim who wrote (6065)	11/18/1999 8:03:00 PM
From: Patherzen	Respond to of 10027

I just found this informative post on Motley FoolBoard... Subject: Re: to sell or not to sell.. Date: 11/18/99 9:38 AM Email this to a Friend Format for Printing Author: DocLou Number: of 7870 Recommendations: 0 The transaction will result in a newly formed parent holding company, which will issue shares on a tax-free basis to holders of Knight common stock and to the owners of Arbitrade. The Knight shares will be exchanged on a one-for-one basis while the Arbitrade owners will receive a variable number of shares based on the market price of Knight common stock prior to the closing. If the average closing price of Knight common stock for the 10 trading days ending on the third trading day prior to the closing of the transaction is within a $23.45 to $35.175 collar, Arbitrade's owners will receive shares with a total market value of $370 million. The minimum number of shares to be issued to Arbitrade's owners above the upper end of the collar is 10.5 million shares (approximately 8.6 percent shares outstanding immediately following the transaction), while the maximum number of shares to be issued to Arbitrade's owners below the lower end of the collar is 15.8 million shares (approximately 12.4 percent of shares outstanding immediately following the transaction). Based on the closing price of Knight common stock on November 17, 1999, the value of the shares that would be issued to the Arbitrade owners is approximately $459 million. Following the transactions, Knight and Arbitrade will become subsidiaries of the new parent holding company. Upon completion of the merger, the new parent holding company will assume the name ``Knight/Trimark Group, Inc.' and will become the publicly traded NASDAQ company (NITE). Eveline: As with any acquisition, if you have a 200 million dollar company, and you acquire a 100 million dollar company, you have more shares, but you now have a 300 million dollar company. Synergies between the companies might create a company that is worth more than the sum of the two. Apparently the stock market thinks this is the case as NITE is up 10% on the news. That collar of $23.45 to $35.175 seems kind of scary to me considering the current price of NITE. I hope that this just represents a "worst case scenario", and not a future projection of NITE price next quarter. Dr.Lou