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Technology Stocks : Leap Wireless International (LWIN) -- Ignore unavailable to you. Want to Upgrade?

To: Jeff Vayda who wrote (336)	4/28/1999 12:39:00 PM
From: bananawind	Read Replies (1) \| Respond to of 2737

Jeff, There is no inherent reason why a secondary done at a price fairly reflecting the value of the business should be a negative. As long as every dollar of value given is exchanged for a like number of cash dollars from the buyers there is no dilution to the existing shareholders. But valuation is not so easy when it comes to Leap is it? Also, from a practical standpoint, I believe the announcement of a secondary is usually followed by a selloff of varying severity. But it may be a necessary evil in Leap's case as $240 million of equity can only be stretched so far in supporting additional debt, not to mention their cash burn rate. Don't get me wrong. I hold Leap and trust that Harvey and his team will produce a lot of shareholder value before they are done. But whether the stock is an "easy double" in the short term, which is what I was really responding to, is far less certain in my mind. Best regards, Jim