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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: Mani1 who wrote (102)	7/6/2000 8:48:26 PM
From: Petz	Respond to of 275872

Mani, <Is there any guesses as to what percentage of the bond holders will accept this offer?> AMD probably polled some of the biggest holders to find out what premium they would have to pay to get them to tender their bonds. So, chances are a majority of the holders will tender their bonds. 50 basis points premium means about $1050 now vs. waiting 13 months for $1050 but getting two interest payments of $55. This assumes that the "call provision" has a 5% $50 premium, it may be more or less, and that the 5.5% US treasury note used as a benchmark is trading at about par. Getting the extra $110 is marginally better if there was no risk. But the risk is not just with AMD's finances, there's also interest rate risk which could lower your note value over the next 13 months while waiting for the "call" which wouldn't happen if interest rates rose. Petz