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Technology Stocks : MEMC INT'L. (WFR -NYSE) The Sleeping Giant? -- Ignore unavailable to you. Want to Upgrade?

To: SE who wrote (4291)	3/22/1999 6:55:00 PM
From: All Mtn Ski	Respond to of 4697

I'm not too impressed with the rights offering, 3 weeks seems to offer no benefit to longer-term shareholders, and will pin the price down. I don't need anymore WFR shares, if I wanted more at these levels I would just go buy more at the market. Since the price premium is gone, a 3 week time premium will be nothing, anybody want a 1/16 for my rights? Tom

To: SE who wrote (4291)	3/22/1999 7:59:00 PM
From: Zeev Hed	Read Replies (1) \| Respond to of 4697

Scott, VEBA has loaned WFR a lot of money to go through the last two years, right now some of this debt has to be repaid and WFR needs additional money to survive few quarters of possible negative cash flow. They actually needed $200 MM. Well, VEBA could have bought shares outright, but that would have exposed them to claims by ambulance chasers that they "took control" of WFR without giving the public share holders a chance to keep their percentage in the company on exactly the same basis as VEBA. If the public does not exercise its right, , VEBA will be in a position to buy the shares not taken (as well as those people that exercise the rights), this will relieve VEBA from any potential suit by the ambulance chasers. You can buy the shares today ($6.5 /cheaper than through the right, ex commissions, which I doubt comes to $.375/share) cheaper, I doubt many of these rights will be exercised in the next three weeks, and then VEBA will end up having to pony a big chunk of the $95 MM, if they so want. By the way, this will increase the number of shares by about 30 MM shares or 75%. Zeev

To: SE who wrote (4291)	3/22/1999 10:23:00 PM
From: Carl R.	Read Replies (1) \| Respond to of 4697

Scott, I think that this is indeed very much the same as a warrant call, which I have also (barely) lived through, and do not care to relive. <VBG> And this is exactly the reason I bailed out of this stock at around 9 and have been waiting for the final terms to come out. It will be as if hundreds of thousands of calls were suddenly written. Some will sell them for whatever they can get, and arbitrageurs will buy them and short the stock (not 1 for 1) to maintain a neutral position. They will do this because the rights will be priced below fair market value due to the large number of sellers. This will for a time have a damping effect on the stock (as it did today). I will have to contemplate for awhile to figure out exactly how to play the arbitrage/hedge position, but suffice it to say that I do not believe that the stock will get above 6 7/8 prior to expiration regardless of what happens from a fundamental perspective in the meantime. Good luck, Carl