RE:RE:How Does the Math Play Out?In order to explain this I will give 2 scenarios, both involving acquiring 50k shares of ALEF:
SCENARIO 1) Go BUY 50k Shares on Open Market of ALEF
50k x $1.36 = $68,000
-$1.36 was ALEF close price today
SCENARIO 2) Go BUY 59.688k Shares on Open Market of EMC
59.688k x $0.89 = $53,122
-$0.89 was EMC close price today
-Conversion as per Definitive Agreement states each EMC share converts into .8377 ALEF share
-50k Shares of ALEF / .8377 equates to 59.688k Shares of EMC
**for same $68,000 in scenario #1 above, I could BUY 76,404 Shares of EMC, which upon DEAL close would equate to 64,003 ALEF Shares
***What I'm saying is I don't understand why EMC is trading this low (if one assumes the DEAL will close as is). Furthermore, the DEAL terms value EMC to low and I expect a Bidding war
ArthurVandelay wrote: Yes, you are quite right. It's an all share deal, so the stock price right now doesn't mean much. You get 0.8377 shares of ALEF for each EMC share you hold. So yes, 10K of EMC shares gets you 8,377 shares of ALEF.
AV