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Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: wm sharp who wrote (3516)	7/28/1998 10:09:00 PM
From: kolo55	Read Replies (2) \| Respond to of 27311

Some cautionary notes. It occurs to me that the stock will probably bounce into the 6s tomorrow, but I wonder: Above 6, won't Castle Creek be in a position to sell the stock short, and reduce their position to an arbitrage play? They have $7.5M earning 6% (although interest is deferred), that is convertible to common shares at about $6 per share. Won't they have an incentive to sell if the price goes to 6 1/2 for example? I think we should keep our enthusiasm tempered for a while. Castle Creek could have a supply of 1.25M shares on the short side, if the price gets too frothy. OTOH, who knows how many people were sitting on the sidelines watching this baby until the financing was done. All I know, is that tomorrow is gonna be interesting. Paul