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Microcap & Penny Stocks : FAMH - FIRAMADA Staffing Services -- Ignore unavailable to you. Want to Upgrade?

To: Double Dipper who wrote (6041)	3/12/1998 8:17:00 PM
From: VBH	Read Replies (1) \| Respond to of 27968

LOL So much for my wildest dreams....at least it aint no nightmare! G

To: Double Dipper who wrote (6041)	3/12/1998 8:18:00 PM
From: bthauler	Read Replies (1) \| Respond to of 27968

Thursday March 12, 7:45 pm Eastern Time If Nasdaz and American mergered - What would that do to price of FAMH New to the thread. FOCUS-Amex-Nasdaq talk, details sketchy NEW YORK, March 12 (Reuters) - Wall Street was scrambling Thursday to find out how the American Stock Exchange ''open outcry'' system of trading would be merged into the electronic floor-less Nasdaq trading system after the surprise news that the two were talking merger. After word of the talks between the Amex and Nasdaq hit morning newspapers, a source familiar with the situation characterized the current status as a ''preliminary proposal'' that was not far enough long to be considered a tentative agreement. As people left the Amex in lower Manhattan at the end of the workday, many were on edge. Equity traders appeared to be the most concerned. Robert Grundstein, an options trader with Liberty Capital, told a reporter as he departed the Amex that equities traders would have more reason to be anxious. ''Nasdaq is a computer-oriented behemoth,'' Grundstein said. ''It's a lot cheaper to have technology rather than people. I am not terrified but there is anxiety.'' The biggest question mark was how options trading, the most vibrant part of Amex, would fit in with Nasdaq. Some traders thought it might be left as a separate unit or combined with the options trading that is part of the Philadelphia Stock Exchange. ''These are two very dissimilar systems,'' said Douglas Meyer, vice president of equity trading at broker Interstate/Johnson Lane, referring to the general idea of an Amex-Nasdaq combination. ''I would think they will have to keep the two systems separate for a while because you have an auction system on Amex and negotiated computer trading on Nasdaq.'' Early reaction was generally that a merger would be good for both Nasdaq and the Amex, helping the Amex reverse slippage in its listed equity business and helping Nasdaq move to new trading systems what would better serve both small investors and big institutional traders. But some concern also cropped up that perhaps the Amex would not be able to muster a vote for the plan. In order for Amex to approve the merger, a favorable vote will be needed from two-thirds of the 864 members owning seats. A source said the quoted prices for seats on the Amex, most recently changing hands at $480,000, were likely to go through the roof with everting on hold until people knew exactly what was going on. Amex chairman and chief executive Richard Syron and president and chief operating officer Tom Ryan briefed members at the end of the day on the talks, saying there was much work to be done, according to the source familiar with the situation. The source said the Amex board also met but did not vote on anything. Some people spoke out criticizing the plan. Alan Davidson, president of Zeus Securities in Jericho, N.Y. and president of the Independent Broker Dealer Association called the possible merger downright anti-competitive and said the IBDA would take further action. ''We are opposed to the merger because we consider it to be anti-competitive,'' Davidson said. ''The NASD (National Association of Securities Dealers, Nasdaq parent) has a monopoly already and this seems to be feeding the monster. The New York Stock Exchange, noting that its customers are different from Nasdaq and Amex customers, said in a statement that it viewed the talks as a ''positive step.'' ------------------------------------------------------------------------ Related News Categories: US Market News

To: Double Dipper who wrote (6041)	3/12/1998 11:36:00 PM
From: Brad	Read Replies (4) \| Respond to of 27968

Kevin & VBH, There is a BIG difference in the terms you are using and what is proposed to happen here. Technically this could be a "reverse merger," but it IS NOT AT ALL a "reverse split!" Reverse splits are normally used for 2 reasons: 1) A company has to regain share price to STAY on a major exchange, 2) A company (listed or BB) has run out of Authorized Shares and must "consolidate" in order to have more shares to issue because they still need more money. FAMH is NOT in either of these situations. A share exchange would occur because they are MERGING. FAMH is bringing the value into probably an empty NASDAQ shell. That is why it is called a "reverse merger." In a normal merger, the NASDAQ company would normally have more assets and more value than the merging company that comes "under their tent." In the FAMH case, FAMH is the one with the value. As you can see, there's a big difference between "reverse merger" and "reverse split." Once in a great while, a reverse split is done for a positive reason. That reason is when, for example, a BB stock wants to increase its share price to finish meeting the qualifications for listing on a major exchange. Again, FAMH is not doing that at this point. But many people confuse the terms "reverse merger" with "reverse split" simply because they sound similar. BIG mistake! As for my thoughts... I think a reverse merger is great here because we are essentially getting a NASDAQ shell for the "price" of whatever warrants are issued to the shareholders of the un-named NASDAQ company. And that interest should be very small by my calculations and by what was stated in the press release. The press release says the post-merger EPS calculation for 97 would be 36 cents. So I figure it like this... FAMH Current 97 EPS = 10.85› 10.85› x 4 (4 to 1 ratio) = 43.4› post-merger EPS equivalent In the press release, Ira said 36› post-merger EPS equivalent 36 divided by 43.4 = 82.9% so the other 17.1% is possible dilution that could occur by allowing for warrants for the un-named NASDAQ company shareholders. If 40 million FAMH shares become 10 million shares of the new company, and that represents 82.9% of the total shares outstanding, we would have apx 12,062,000 total shares outstanding in the new company post-merger. Post-Merger Summary: 12,062,000 total shares outstanding 1997 EPS 36› 1998 EPS 82› to 99› (using current projections from FAMH for 1998 EPS 25-30 cents x 4 x 82.9%) P/E (based on FUTURE earnings, as most NASDAQ companies are): 25 - 35 Share Price when based on future earnings projections: .82 x 25 = $20.50 (on the low end) .99 x 35 = $34.65 (on the high end) Average = $27.57 per share (previously 4 FAMH shares) I like those numbers a lot!!! Granted, this won't happen overnight, but I could certainly see this as a possibility over the next 6 to 9 months. Just my opinion, of course. If you have an investment advisor, you might see what they think of our little "diamond in the rough." :-) Best wishes, Brad