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

To: TimbaBear who wrote (15051)	8/4/2002 3:07:49 PM
From: Jurgis Bekepuris	Respond to of 78523

Timba, "The outstanding put obligations at February 1, 2002 permitted net share settlement at the Company’s option" It is conceivable that the purchaser of puts entered into a contract allowing Dell to buy the puts back using Dell's shares. It's somewhat complicated but possible. Without seeing the contract we'll never know. Jurgis

To: TimbaBear who wrote (15051)	8/4/2002 3:16:09 PM
From: j g cordes	Read Replies (1) \| Respond to of 78523

Jurgis or Timba.. I haven't thought this through but IF Dell intended to buy back shares or even if they suddenly decided to buy back shares.. could that share buyback satisfy the put selling position AND retire shares at the same time? If so it would be rather brilliant.. because they took some money in selling the puts, then buy back the shares (which is good.. fewer shares in float) at a lower price. Either way they make out ok.. if the stock had gone up they pocket the put sales, when the stock goes down they cover by buying shares out of circulation.. and who's to say they can't sell more puts now to cover buying previous obligations. I have a suspicion that with HP's problems with CPQ having caused lots of channel problems.. they gained significant market share. In addition, they've been selling EMC storage systems like hot cakes.. now they're going into the printer market with momentum that HP's losing and looking ahead at PDA opportunities. Seems to me their put plays shouldn't be a problem. JIm