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Biotech / Medical : ARRIS - Another partner -- Ignore unavailable to you. Want to Upgrade?

To: Miljenko Zuanic who wrote (329)	12/29/1997 12:48:00 PM
From: bob s	Read Replies (1) \| Respond to of 353

MZ-With a 1.35 conversion ratio with SQNA isn't ARRS way too cheap?? Why it's going down like this is strange unless the merger falling apart is a possibility??? Bob

To: Miljenko Zuanic who wrote (329)	12/29/1997 9:19:00 PM
From: John Metcalf	Read Replies (2) \| Respond to of 353

Good question, Miljenko. ARRS/SQNA is already at a very low valuation. The combined market cap of the two companies is $224mm, and they have half of that ($113mm) in cash. There are very few companies selling for twice their cash on hand. Collaborations of the combined companies account for at least 4 times the technology value of AxyS. In my view, the valuations are irrationally low right now. There seems to be selling from those who don't like the merger, and also from those who like it but don't expect completion. Not to mention selling to recognize tax losses, and selling related to the general biotech doldrums. I would not expect buyers to emerge until there is some sense of strategic direction for the new entity.