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Technology Stocks : IRID - Iridium World Communications IPO Announced! -- Ignore unavailable to you. Want to Upgrade?

To: Joe Brown who wrote (1203)	1/5/1999 7:53:00 PM
From: Joe Brown	Read Replies (2) \| Respond to of 2693

Discussions with IRIDIUM personnel, a Wall Street analyst and a portfolio manager today about the pending equity offering yielded the following: The offering is intended to decrease/eliminate IRIDIUM's reliance on a Motorola debt guarantee of approximately $350 million; in this sense, it's a plus for both companies. The offer, based on the full conversion of all limited partner units into shares, is dilutive in an amount of less than 5%. Current float (not total shares) is 12 million shares; an increase in the float would provide liquidity, the lack of which has been a problem for some institutions. Overall, the deal would decrease debt exposure with minimal dilution and easily see IRIDIUM to cash flow breakeven later this year. But Wall Street would clearly like to see results soon... My personal opinion is that two things must happen now for IRIDIUM to "deliver the goods": (1)the equity offering must be eagerly received, and (2)handset deliveries and subscriber signups must ramp up quickly this month and next. If these things do not happen, then I worry that a lot of elegant technology will go to waste... Knowing the company as I do, I believe these two things will happen, first because the underwriters are major firms with excellent syndicate departments and, second, because my own experience suggests this phone is a winner. We will see soon enough...