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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Sam who wrote (8683)	1/14/2000 3:43:00 PM
From: Ausdauer	Read Replies (2) \| Respond to of 60323

Sam, Here is the math... (111,000,000 shares x $3.56) - $51 million = $344 million dollar gain. (where $51 million is the original investment) They are reporting a taxable gain of $344 million based on the present value of the shares they own in UMC. The other foundry investors have reported similar taxable gains as I posted earlier in the week. My understanding is that none of the shares have been sold. BTW, they will use proceeds to pay for the conference call. These calls are very expensive to the company and the total cost is derived by a fee multiplied by the number of callers who log into the phone center. This is why I have gone to the trouble of summarizing previous conference calls for this Thread. I felt it would decrease the number of callers. All are free to call and listen if they so chose. Ausdauer

To: Sam who wrote (8683)	1/14/2000 3:53:00 PM
From: Bargain Hunter	Respond to of 60323

SNDK didn't sell anything and didn't receive any cash. They just traded their pre-merger USIC stock for post-merger UMC stock. They either had to, or elected to, update the basis of the investment to the value at that time. The important point here is that next quarter's earnings will be artificially high. That could generate some attention from those who read the "upside surprises" list, at least until people discount the one-time gain. But, no matter what, it will depress the sky-high P/E ratio.