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Technology Stocks : THQ,Inc. (THQI) -- Ignore unavailable to you. Want to Upgrade?

To: Double Dipper who wrote (2863)	1/3/1998 4:05:00 PM
From: Todd D. Wiener	Read Replies (3) \| Respond to of 14266

Kevin- I seriously doubt that THQ will attempt another secondary anytime soon. I admit that it's tempting, but I think they'd be more likely to do it in a year, when the stock is above $40. I don't really expect THQ to do it at all, but I certainly would be shocked if it happened in the near future. It is a valid concern, but I don't expect it to be an issue. Remember that THQ did the secondary because their liquidity was limited. The company has a good balance sheet now, so another offering would be due to greed/impatience more than necessity. It would be a better use of the high stock price to buyout Inland. THQ paid ~$600,000 (in cash & stock) for 25% of Inland. I'm guessing at numbers, but I can't see THQ paying more than $5 million for the remaining 75%. It may be a cash & stock deal, such as 100,000 shares of THQI stock and $2 million dollars. That seems reasonable to me. And that would certainly be accretive to THQI's EPS, or else the company wouldn't do the deal. It's true that Cendant should be interested in Inland if THQ is interested, but that doesn't mean anything. After all, if we've been buying THQI for a while, shouldn't Cendant have bought THQ yet? There are plenty of development studios out there, and there are a few with great products (Nitro). But Cendant would be more likely to buy a complete company, like THQ, rather than bits and pieces. If Cendant were to buy Inland's remaining 75% stock, it would probably finish the job by buying THQ. If this scenario were to occur, it's more likely that Cendant would buy THQ first, and then buy the rest of Inland. THQ already has a relationship with Inland, and THQ understands Nitro's potential much better than Cendant does. Todd