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Technology Stocks : Walt Disney -- Ignore unavailable to you. Want to Upgrade?

To: MoneyPenny who wrote (855)	7/17/1998 7:59:00 AM
From: Ken Sammut	Respond to of 2222

Hope there is some truth to the following post copied from the RENT Yahoo board. With the movie industry going to revenue sharing, this could add some nice revenue to the bottom line. >>>>><- Previous Message 675 of 675ÿÿÿÿ Reply ÿÿÿÿÿ Buyout ComingPettrova Jul 16 1998 6:26PM EDTOn July 14, 1998, Disney filed a 13D registration with the SEC to declare that they have over 1,500,000 warrants to buy Rentrak at $6.58 per share. Why did they file this? There appears to be no legal reason for doing so. I believe this was the first step of Disney's take over of Rentrak. 1.5 million shares represent 12% of Rentrak. The whole company could be bought for 120 million dollars at $10/share. That is about half of this years estimated sales. Why would Disney want to buy? Disney has already said they want all their videos on revenue sharing within the next two years. The only two companies who do revenue sharing are Rentrak and Disney's own Supercom. The problem is Supercom's software doesn't work. They are 3 years behind Rentrak in development and the current product does not do what it needs to do. Yet they are being inundated with orders. The largest distributor in America, Ingram, was the first to sign up. They have signed most of the other distributors and have signed several of the major studios. This business is going to be huge with Rentrak doing at least $200 million this year alone. If they had all the studios it could be twice that. What is the software problem? Cheating is the biggest. Supercom doesn't have Rentrak's sophisticated software to know when they are being cheated. They need to keep track of every video rented at every store every day. Hollywood Entertainment tried to cheat Rentrak out of millions of dollars last year. If you can't trust the 2nd largest video chain you probably have to beware of all of them. Supercom does not know how much money they are losing to cheaters. To speed up the development of their software by 3 years, they can buy Rentrak (RENT) and change the name to Supercom. Will the other studios go along? They are already signing with Supercom. The whole business has changed in the last six months now that Blockbuster and Hollywood are doing revenue sharing direct with the studios. What price? Who knows. How about one share of Disney for each three Rentrak. That would equal about $13/share. Disney trades stock at 40 times earnings for stock at about 10 times earnings. This is a good deal for everyone. >>>>>>