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Technology Stocks : PSIX up 26.5%, Takeover(?) -- Ignore unavailable to you. Want to Upgrade?

To: bob zagorin who wrote (1879)1/23/1998 5:30:00 PM
From: Dave  Respond to of 5650
 
Bob:

I did.

psi.net

IXC will receive common stock at closing equal to approximately 20 percent of the issued and outstanding shares, after giving effect to the IXC issuance. In addition, if the value of these shares is less than $240 million at one year following delivery of the total bandwidth, PSINet has agreed to provide IXC with cash and/or additional stock, at PSINet's option, to make up the difference.

40 Million shares outstanding. 20% is 8 M. That is $30/share to enter into a 20 year NON-CANCELABLE agreement. That is crazy. Is IXC the Intel of fiber optic cable? NO

dave



To: bob zagorin who wrote (1879)1/23/1998 6:02:00 PM
From: Rubber Man  Respond to of 5650
 
I read somewhere that IXIC can deliver the capacity within 3 years, and that if you calculate the rate of return, PSIX will need to grow by 45% a year in order to pump the stock from $8 to $24.

Why $24? 10M shares will be issued, bringing the total to 50M (ie. 20% of 50M is 10M shares) and since it's those shares must be worth $240 million when bandwidth is delivered..


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