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Biotech / Medical : Genomic Solutions-naz{GNSL} -- Ignore unavailable to you. Want to Upgrade?

To: smh who wrote (44)	12/24/2000 2:37:40 AM
From: tuck	Read Replies (1) \| Respond to of 93

smh, Have I completely misread the S-1/A? Perkin Elmer owned 18% as of the offering and apparently has rights up to 19.9% per the latest S-1/A: >>If PerkinElmer sells more than 50% of its common stock, including any shares converted into callable common stock, it will no longer have the right to cause us to redeem our callable common stock, nor will it have the right to acquire up to 19.9% of our outstanding capital stock.<< The section you cite raises the concern that Perkin Elmer can cash its stock in for more money than the stock is then selling at if the stock continues to underperform. That is my read. I see no language that allows Perkin Elmer to "get" GNSL cheap, whatever that meant (the whole company?), except by normal takeover procedures at a price the board would accept. It is a protection against underperformance for PE, at everyone else's expense. The lanaguage about bona fide acquisition offers has to do with offers from other companies, not PE. It is a legitimate concern if you bought at higher prices. Just what concerns are being bandied about? What am I missing? My concern is that, if PE exercises its right, GNSL will have to issue more stock to raise the cash to meet the redemption. The reduction in outstanding from the redemption would be offset by the new common, and the expense & distraction associated with the deal. But remember that all the stock becomes callable, including that not held by PE, if PE exercises. This raises an interesting scenario. What if everbody does it? To raise cash for redemption of 7 million shares of common, GNSL would essentially have to do an enormous secondary at a bad time. Wouldn't be the problem of the initial set of shareholders, unless it came to bankruptcy. That's another reason to buy now, if you're going to: should PE redeem, you can redeem, too, for more than you'd pay now. I have an order in for more. All my HO, possibly way off base, but you asked and I am interested. Happy Holidays, Tuck