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Technology Stocks : Nortel Networks (NT) -- Ignore unavailable to you. Want to Upgrade?

To: telecomguy who wrote (4496)	1/27/2000 12:09:00 PM
From: mtnlady	Read Replies (1) \| Respond to of 14638

Tele - one thing that I don't see and I believe you can help explain it to me. This is BCE's argument from what I can tell. BCE is valued too cheaply for the assets/companies she holds. This I can see and have heard many times before. To 'unlock' that 'hidden wealth' BCE spins off the NT shares to it's stock holders. OK .. now here is the part I don't understand. BCE benefits by ? They are not selling the shares to their stockholders correct? They are giving the shares to them (please correct me if I am wrong). BCE hopes to 'gain share value' through this maneuver (do they gain any other way?) through.. ST - folks will buy more BCE shares now. I can see that if folks are trying to get the NT 'stock dividend' but several other posters have stated they don't buy BCE for NT. They buy BCE for BCE's 'underlying value'. Well that 'underlying value' hasn't changed sense last week hence these folks wouldn't buy anymore BCE because they weren't buying for the NT shares to begin with. Now folks like I might! So let's just say that there are a few more average 'ignorant' investors like me (safe bet! <vbg>) than the BCE experts who are buying all along for BCE's underlying value. Ignorance rules so BCE goes up in the ST. LT - NT is gone and I am holding BCE shares on their own merit now. OK - now is the part that alludes me. Let's see if I can state this somewhat clearly. We basically have two groups of BCE owners now. The 'ignorant' ones that bought for NT and the nice perk of BCE. And the second group being the very knowledgeable folks who bought BCE awhile ago for BCE's underlying value - i.e. they have known all along what BCE's true worth is and that is why they bought it. OK - this is where BCE's strategy either makes it or I am right and us 'ignorant' folks end up keeping the NT and selling the BCE shares (thus hurting BCE not helping her..). SOMEHOW (!) as I am holding my BCE shares, minus the NT now, BCE's underlying value, both present and more importantly FUTURE value, suddenly becomes quite clear to me. Enough so that I will hold on to these shares. What is going to get me to suddenly appreciate BCE's underlying value, and future value, if I don't see it, or value it, now? Will BCE's management to convince me of BCE's worth, future and vision? If they are capable of convincing me of that then, then why can't they do it now? What will change a couple of weeks from now when NT, their most valuable and fastest growing asset, is gone? Remember this is Jane/John Q public you are talking to. What I've seen (Ms. Average here of course) is a CEO sell off their most valuable and fastest growing asset to gain ? nothing (?) Maybe a ST gain for the company (i.e. see above). I wouldn't do that with my fastest growing stock in my portfolio - at least not sell the entire holding! And here I am holding BCE which is made up of (?) Canadian telephone companies (I really don't know)? I don't own AT&T or PacBell now (I buy GBLX, QCOM, JDSU and NT instead)- why would I keep a Canadian telephone company? That is nothing about Canadian - it could be a UK telephone company for all I care. Remember guys.. it's john/jane Q public (i.e. dumb folks like me) that are going to either make this deal work or make it blow up in BCE's face. What am I missing? I think BCE's strategy could backfire in their faces. LT it might actually help NT because folks buying BCE now for NT will just focus on buying 'pure' NT in the future. So NT shares go up and not BCE. You guys have convinced me that BCE has underlying value (I already knew that). I am not convinced this strategy is going to help BCE in the long run.