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Technology Stocks : VLSI Technology - Waiting for good news from NASDAQ !!! -- Ignore unavailable to you. Want to Upgrade?

To: otter who wrote (5377)	3/2/1999 11:15:00 AM
From: Greger	Read Replies (1) \| Respond to of 6565

Gruntal & Co. reiterated its strong Buy rating on VLSI last night. Prior to the offer, their target was $18. They state the offer is too low and believe it will go higher.

To: otter who wrote (5377)	3/2/1999 11:16:00 AM
From: otter	Respond to of 6565

There is more to this.... I hold Jan 2000 options with a strike price of 10. Yesterday, I had a long conversation with my broker on what would happen if... and because cash buyouts where options are involved are not very common, he had to speak with others on it. He said that: 1. If I were hold the options through deal closing, it might be months (his word) before receiving the cash. His recommendation was to sell the options - discounted as they would be below the cash price of the underlying stock so as to avoid that delay. 2. the options would continue to trade at a discount to the price offer (if accepted). That may be true, but at this SPECIFIC juncture, bid is 7, making them exactly what I would receive if I held the options through cashout. VLSI is continuing to rise.... half a point yesterday, and so far today about that much. A couple of days ago, most of us agreed that the discount to the offering price reflected a lack of belief that the offer would be accepted - or that any meaningful counteroffer would be issued - and I for one, didn't think there was much more to gain until we heard VLSI's response (silly me). If the market is continuing to bid up the price of VLSI in this manner, what does it suggest that the market is saying? and more to the point - what does it say about whether options are a good alternative? Does it make sense to (a) buy more? (b) holdem and do nothing? (c) sell and thank my lucky stars, or (d) sell and then buy stock? I think I'm agonna hold, but if I get tempted to buy, it would be those with the best combination of low strike price and time. (near term at or out of the money options are not my cuppa tea).