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Strategies & Market Trends : Options -- Ignore unavailable to you. Want to Upgrade?

To: Jill who wrote (2900)	2/13/2000 6:42:00 PM
From: RocketMan	Read Replies (2) \| Respond to of 8096

OK, guys, how come there hasn't been more discussion about the coms/palm deal? This could be the no-brainer play of the year. You get 1.5 palm shares for every 1 coms share you own six months after their spinoff which is scheudled for Feb 29. Coms closed around 62, and palm is priced right now around 15. They say coms has a fair market price of 30, so the coms+palm deal should be worth 30+15*1.5=52, so you are paying a 10 premium right now. However, keep in mind that palm is the yuppies' fetish, that it is wireless, and that ipo's have been hot, and you could easily have palm go over 100 in six months. Hell, you might have that the first day. If so, that is an easy double. Now, option plays are a little trickier, because distribution does not happen for six months, so you have to play leaps. Jan 01 ATMs are going for around 15, which again are a no-brainer. But, and this is a big but, I can't get a straight answer as to how calls get palm distribution. If you can exercise the leaps and get 100 coms and 150 palm for each leap, that is taking money from a baby. But they might not do it that way, they may adjust the price, or they may give you only coms (which will be a POS by then), or some other deal. I am just buying common right now, because of the risk. But I think I will call my broker, or coms and see if they can tell me how leaps play into this.