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Technology Stocks : Vodafone-Airtouch (NYSE: VOD) -- Ignore unavailable to you. Want to Upgrade?

To: Chuzzlewit who wrote (2169)	11/24/1999 11:26:00 PM
From: MrGreenJeans	Read Replies (1) \| Respond to of 3175

C I do have serious doubts about the value VOD shareholders will receive. As a shareholder, are you going to hold on to or sell your Vod shares based on these doubts? Put another way, I fear that the expected synergies will not be sufficient to offset the dilution in ownership I will experience. Remember that Vod management is also heavy invested in the equity themselves. The issues you are concerned with they are concerned with. I have confidence the synergies will be produced. Cellular penetration rates are still very low in most, not all, countries Vod-Ati are involved in. Further, Chris Gent seems to place shareholder value at a high premium. I would also remind you that Vod has increasingly raised their dividend over the years reflecting their strong cash flows from cellular growth. We are in unchartered waters here. I will admit a number of outcomes both good and bad can happen but consider the following: If a merger takes place the new company will be a $225 billion dollar enterprise. That may seem large now but with a possible Att-BT combination, a prospective MCIWorldCom-Sprint combination, it may seem small in the years ahead. I suspect at some point another larger company will try to takeover Vod-Ati-Mannesmann. Net net I see a bright future.

To: Chuzzlewit who wrote (2169)	11/25/1999 3:29:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 3175

This is the "teaser" for the HBR article: hbsp.harvard.edu In 1988, less than 2% of large deals were paid for entirely in stock; by 1998, that number had risen to 50%. The shift has profound ramifications for shareholders of both the acquiring and acquired companies. In this article, the authors provide a framework and two simple tools to guide boards of both companies through the issues they need to consider when making decisions about how to pay for -- and whether to accept -- a deal. First an acquirer has to decide whether to finance the deal using stock or pay cash. Second, if the acquirer decides to issue stock, it then must decide whether to offer a fixed value of shares or a fixed number of them. Offering cash places all the potential risks and rewards with the acquirer -- and sends a strong signal to the markets that it has confidence in the value not only of the deal but in its own stock. By issuing shares, however, an acquirer in essence offers to share the newly merged company with the stockholders of the acquired company -- a signal the market often interprets as a lack of confidence in the value of the acquirer's stock. Offering a fixed number of shares reinforces that impression because it requires the selling stockholders to share the risk that the value of the acquirer's stock will decline before the deal goes through. Offering a fixed value of shares sends a more confident signal to the markets, as the acquirer assumes all of that risk. The choice between cash and stock should never be made without full and careful consideration of the potential consequences. The all-too-frequent disappointing returns from stock transactions underscore how important the method of payment truly is. I will post my summary of the article this weekend or early next week. TTFN, CTC