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Technology Stocks : Safeguard Scientifics SFE -- Ignore unavailable to you. Want to Upgrade?

To: KatayamaGorobei who wrote (1491)	7/9/1998 5:48:00 PM
From: John Arnopp	Read Replies (2) \| Respond to of 4467

Ron, AN EXCELLENT FIND! I didn't even list ICG as a choice, but I should have. Although, it does not appear to be a candidate anyway: Of course, there is no guarantee that Safeguard will even hold an IPO for Internet Capital. The SEC application said Internet Capital is only ''considering the possibility'' of an initial public offering of its securities. Moreover, the SEC application may take four to 12 months to wend its way through the agency, said Pierre de Saint Phalle, an attorney at Davis Polk & Wardwell who is representing Internet Capital. The application essentially seeks assurance from the SEC that Internet Capital won't be regulated as an ''investment company'' under the Investment Company Act of 1940 after it was publicly traded. The law is designed for mutual funds and would pose difficulties for an operating company such as Internet Capital, de Saint Phalle said. I'm not sure how long it would really take to get through the SEC, but without the exemption, ICG would most likely be subject to the 1940 Act (from the SEC's "Investment Company Registration Package"): ...Unless excepted or exempted, every issuer...is subject to the 1940 Act if it does any one of the following activities: (3) it is engaged or proposes to engage in the business of investing, reinvesting, owning, holding, or trading in securities, and owns or proposes to acquire securities...having a value exceeding 40 percent of the value of its total assets...on an unconsolidated basis. And it would be a major problem for them to conduct business under the Act. Currently, I'm assuming they are exempt because their securities are owned by less than 100 persons and they are not making a public offering. But I sure would like to own it! I guess Safeguard wants to cash in on some Internet hype, because it really does seem doubtful ICG can be the next offering. Anyone else? --John