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Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: serious_stuff who wrote (41703)	3/12/2000 12:38:00 PM
From: Method	Respond to of 45548

If they do a deal it may be similar to deals done by BCE in Canada. BCE owns 40% of Nortel and is completing a spin-off soon. BCE has made several deals since announcing the spin-off but uses the stub amount as the basis of any stock deal with an estimate of what the stub will trade at. BCE's stub trades at $30 but they recently made a deal with the stub estimated to be $50 by deal closing. The problem with COMS right now is that the stub is at -$40.

To: serious_stuff who wrote (41703)	3/13/2000 7:22:00 AM
From: Souze	Respond to of 45548

In answer to your points: 1) No company is going to take 3com paper that will have its value cut in half or more by the time the deal is closed. The deal(s) can close before the distribution. If it/they do, they get PALM stock at the distribution. That's precisely my worry. 2) Shareholders of 3com would never approve of a deal that was significantly dilutive prior to the Palm distribution. Evidently, 3Com shareholders don't get a say. With a total of 990 million 3Com shares already authorized, there's enough stock on the shelf to do deal(s) without coming to the shareholders. 3) EB and the board, despite appearances to the contrary on occasion, have a vested interest in seeing the Palm shares spun out to 3com shareholders as quickly and undilutedly as possible. Yes, I agree that they do. They also have an obligation to act in the best long term interests of 3Com. Those can be competing interests.