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Technology Stocks : MRV Communications (MRVC) opinions? -- Ignore unavailable to you. Want to Upgrade?

To: WebDrone who wrote (13080)	4/30/1999 12:01:00 AM
From: Sector Investor	Respond to of 42804

I guess I don't understand the issue here. First let me post this and ask my question in another post. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT. The following table sets forth certain information regarding the beneficial ownership of the Common Stock as of March 19, 1999, of (i) each person known by the Company to own beneficially 5% or more of the Common Stock, (ii) each current director of the Company owning Common Stock, (iii) each of the Named Executive Officers owning Common Stock, and (iv) all current directors and executive officers as a group. Number of Shares Name and Address(1) Beneficially Percentage of of Beneficial Owner Owned(2) Class ------------------- ---------------- ------------- Shlomo Margalit .................... 1,843,930 6.9% Zeev Rav-Noy ....................... 1,713,915 6.4% Noam Lotan ......................... 863,437 3.2% Ken Ahmad (3) ...................... 313,464 1.2% All Directors and Executive Officers as a Group (8 persons) (3) ....... 4,734,746 17.7% ---------- (1) Except as noted below, the address of each of the persons listed is c/o MRV Communications, Inc., 8943 Fullbright Avenue, Chatsworth, CA 91311. (2) Pursuant to the rules of the Commission, shares of Common Stock that an individual or group has a right to acquire within 60 days pursuant to the exercise of options or warrants are deemed to be outstanding for the purpose of computing the percentage ownership of such individual or group, but are not deemed to be outstanding for the purpose of computing the percentage ownership of any other person shown in the table. (3) Includes 150,000 shares issuable pursuant to stock options exercisable within 60 days from March 19, 1999.

To: WebDrone who wrote (13080)	4/30/1999 12:30:00 AM
From: Sector Investor	Read Replies (3) \| Respond to of 42804

Here is what I don't understand. Several on the various MRVC threads have indicated they won't buy until management buys. As I understand things, there are 3 basic ways to do this (are there others?) 1) Personal buy of more shares 2) Corporate buy back of debt 3) Corporate buy back of issued shares. 1) They already own almost 18% of the company, and are getting more shares through stock options. Why is increasing that to say 19-20% important? They own a lot. They are NOT selling what they own (don't bother telling me they sold some at $35 - they deserved to get a good price as part of the secondary). Isn't the fact that they are NOT selling, just as bullish? 2) They DID buy back over $3 million of debt in Q4. They CAN'T buy back the recent convertible debt offering because it is not callable for 3 years. This is counter productive anyway, as the reason they GOT the debt in the first place is to allow them to grow the company, by building the infrastructure, increasing capacity, increasing R&D, upgrading technology (the new foundry), building their PISTOL Lab, etc. All of these moves are a better use of cash than a buy back, IMO. 3) Buy back of shares into treasury reduces the float, which is good because it increases earnings going forward. But this seems like a very poor use of cash to me. They could have bought back 1 million shares for about $6 million (now $10 million). That $6 million would have reduced shares outstanding (or increased earnings) by 3.77% - big deal. Instead they chose to buy 60% of New Access for $3 million, and probably similar levels in Charlotte's Web and HyperChannel for some undisclosed amount, but say another $3 million. So for the same amount, we get majority ownership in three very exciting startups, that each could be worth more than 100 times what MRV paid for them in just a few years, if they are successful. Or, they could spin one or more of them off in an IPO (keeping some ownership) and take advantage of the crazy prices IPOs command these days. Which is more bullish, reducing outstanding shares by 3.77% or buying into HUGE growth markets with seemingly superior products (Metro DWDM (MetroFusion), Carrier class Routers (Aranea), E-Commerce (HyperChannel) )? To me, I am thrilled with these moves, whereas a share buy back seems peanuts in comparison, and does NOTHING to GROW the company. Why do people think otherwise? Inquiring minds want to know.