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Technology Stocks : Netscape -- Giant Killer or Flash in the Pan? -- Ignore unavailable to you. Want to Upgrade?

To: Killian who wrote (4764)	11/25/1998 7:42:00 PM
From: Larry S.	Read Replies (1) \| Respond to of 4903

Shek, it is frequently true that the acquirer's stock goes down while the target stock goes up. But in past years, we have seen a change in this trend when the street likes the deal and the new entity that will be created. OFten now, both stocks go up, I believe i posted earlier that the target stock trades at about a 10% discount to the stock conversion price and that is because the deal might fall through for one reason or another. Look at what happened to CIEN and TLAB. This discount narrows the closer to the actual merger and the increased probability that it will go thru. Look at how MCIC traded relative to WCOM. Right now, if one bought NSCP as a way of buying AOL shares, you would get AOL at a slight discount (assuming the takeover occurs) than if you bought AOL shares directly today. I think that the play in NSCP is over. I have invested in and followed the stock for several years, and have sold most of my position. I own some AOL and probably will hold the remaining shares of NSCP for a bounce up (based on AOL price movement) and possibly thru the conversion. To me, it depends on how much i want to have invested in AOL. I think that the new combination will be very powerful, but also think that AOL has gotten ahead of itself and is due for a pullback. good luck. larry