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Non-Tech : Cityscape Financial (CTYS) -- Ignore unavailable to you. Want to Upgrade?

To: Zeev Hed who wrote (1461)	10/28/1997 11:20:00 PM
From: Rational	Respond to of 2544

Zeev: I accept your apologies <VBG>. CTYS has a $300 mil warehousing facility and there is no restriction for using a small part of this money for buying shares and Bear Stearns can always loan more. BS is a majority shareholder and so they have self-interest to help CTYS buy if they feel that the offer prices are sufficiently below the true value per share. Dilution is a moot point because after CTYS picked up the shares and before Dec 15 deadline they can simply make an announcement that they have enough shares purchesed in the open market for giving to Convertible preferred Stockholders. This will make the stock price jump. If it jumps even to $5, then the number of shares needed will be 15 million which they could have acquired in the open market. Suppose that this quarter's earnings fear could knock off $2 from $10 and assume that the long-term prospect is good. If this assumption is is wrong, none of what I am saying will work as I have already stated earlier. Then the rest of the drop is due to fear on dilution which is real if the price stays at $2.5. But, if that fear is removed due to a stock repurchase program, then the price should jump to $8 which means CTYS will give away just 75/8 = ~9.3 mil shares from those acquired. AGAIN, THESE ARE PURE SPECULATIONS as you have said and I have been very clearly stating. I have no way of knowing what the true prospect of CTYS is to say one way or the other. All that I am saying is that if (as an insider) I knew the true propect to be good, I would execute the above strategy. I will not buy to prop up the price or make pre-announcements to do so, but will pick at the offer price less 1/32. Once I remove most of the float, I have no problem. The real problem here is, though, that the float is not removable because small investors keep jumping in as prices fall and then dump on some "bad" news. Thus, the float is not removable until other bigger daring buyers buy with no desire to dump, like the big blocks today. I do not believe that short-sellers are very active at these prices. If the price falls below $1, I will join you to pick up a lot. If the price rises here on, I will minimize my losses a little. Sankar