Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Safeguard Scientifics SFE -- Ignore unavailable to you. Want to Upgrade?

To: robert miller who wrote (3730)	12/22/1999 11:31:00 AM
From: still learning	Respond to of 4467

Yes, let's lobby for an ICGE tracking stock <g>. Personally, I'm glad to see SFE trail ICGE a bit for now. Eventually all things even out, but for the moment it gives some underlying strength to SFE. BTW, bob raises an interesting point -- will SFE start spinning off via DSSPs a greater % of its shares in IPOs. That would be one way to bring shareholder value without triggering a higher tax rate. It would also enable greater liquidity in the stock, since DSSPs are freely traded shares. Underwriters and the IPO companies may not like the idea, since they want to limit the total offering to about 4-6 mm shares in many cases, keeping supply low and demand high. SFE could account for a greater % of the total IPO thru the DSSP, but that would in effect be moving back towards a rights offering, except without the $5 price. Put yourself in mgmts shoes. A year or two from now SFE is at $300 or $500. The 10:1 limitation benefits older and larger shareholders the most, since they have been the ones to see thru the major splits. Let's say SFE doesn't want to split too many times more. What do they do? The buy in for 100 shares may be $50,000. And 10 shares of OPUS or EMRG ain't that big a dividend anyway. So the shareholders are either big enough to get many shares, or they fall between the cracks. The $39 I pay at Schwab and elsewhere for DSSPs is expensive for a 100 or 200 share trade, let alone for a 10 share trade. IMHO SFE will need to spin off more of its venture holdings into separate companies, like ICGE, AND it will need to figure out a better exit strategy for the IPO shares it holds. These are the two critical issues that come with the recent successes. Anyone else have any thoughts on this?