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Technology Stocks : Winstar Comm. (WCII) -- Ignore unavailable to you. Want to Upgrade?

To: Steven Bowen who wrote (4915)	4/2/1998 2:47:00 PM
From: silicon warrior	Read Replies (1) \| Respond to of 12468

guys, i respectfully disagree. The lease of the 7 switches is a financing transaction--a way to finance the switches. Wcii continues to have all the incidents of ownership as long as it pays the lease payments. Undoubtedly, at the lease's end, they get them free or at low value.It puts the tax value of depreciation to current use. The nominal value of the lease probably relates to how much the financier was willing to lend. E.g., 80% of value in the event of default and foreclosure, Effectively, wcii is keeping the 7 switches for only 12million outlay, rest paid over time. Thus, they really got the switches they wanted dirt cheap