Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Net Perceptions, Inc. (NETP) -- Ignore unavailable to you. Want to Upgrade?

To: bernieb2 who wrote (2589)	7/29/2000 5:13:13 PM
From: rupert1	Read Replies (1) \| Respond to of 2908

Bernie: I have posted under gnu222 for the last time in the post you referred to about Harmon - I have already posted under my new name victor_si_uk. I am not sure whether you are referring to a buy-out or institutional investors buying shares in the open market. NETP is a bargain to an acquirer but so are so many other companies. Also acquirers are suffering from depressed share prices and have to be careful about buying a company that is loss-making. Prolonged weakness in NETP's share price will weaken its bargaining position if it is negotiating with an acquirer. But the most valuable asset NETP has that an acquirer cannot get by buying another company, is its intellectual capital. This means the 23 patents applied for, the ongoing research, the joint research programme with the University, and the brains responsible for it. I think that in a hostile takeover, an acquirer might get away with $30-35 in the month of August. But what would they have acquired? A very unhappy company with a big brain drain. Most institutional investors - and there are 75 - would figure that NETP is good for a price of $25-35 between now and January and would expect an acquirer to pay a premium. But a large number of institutions have paid in excess of $40 - some $45 in the SPO - and some $50+. I don't think they would be happy with less than $40-50. Bottom line is that an acquirer would have to keep the R&D and customers happy and would pay a minimum of $50 if they could get Snyder and company to agree, which I doubt. NETP would hold out for a price equivalent to its high of $66. The only reason the executives would agree at all is if they believed that enough institutions would desert them and leave them high and dry. The acquirer would probably pay in shares, so that would affect the price. If you were referring to institutional investors buying shares in the open market at these levels - I think the only consideration in their minds is whether the market and the sector has quit falling and found its bottom, and even then, if the rebound will come quickly or in another month. While NETP is cheap so are many other companies so we come back to how well NETP has sold its attractions to the institutional investor.