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

To: PDL who wrote (3152)	8/7/1998 7:41:00 PM
From: limtex	Read Replies (1) \| Respond to of 11568

PDL Dougjn and all - Curious ....did Mr Burnam or anyone else complain about the net worth of MCI after the announcement of the acquisition? I don't recall a lot of comment about the net balance sheet position iether for this stock or for that matter any of the other stocks on SI that have been involved in takeovers. The comments usually focus on earnings and costs savings and revenue generation nad quite rightly so. Whenever noe company buys another it either pays less than or the same as or more than the net worth of the target. In the first and last case the difference lands up having to be accounted for. If you paid less than the net worth of the target you get more assets than you apparently paid for and you increase your stockholders funds in the purchasers balance sheet. If you paid more than the net assets that you are apparently buying ( as is the normal case) then you land up with a deduction from the purchasers net worth on his balance sheet. Depending on the accoutning standards in force basically you either write off that differnce over a period of years - the longer the better since the smaller the annual expense or you write it all off day 1 - much better since it then never really affevts the numbers that analysts look at. There it is plain and simple. WCOM being very very up front about their accouting issue - - more so than many other companies have been so we should all be quite comfortable that we are dealing with a very professional leader in the industry in and corporate information. Very well doen to Bernie and the team. L