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Corrections Corporation of America Message Board

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  • flipper_58 flipper_58 Jun 8, 1999 9:42 AM Flag

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    We have hit the one the big problem when REIT's
    don't work, the price for new equity is not accretive
    any more. As this stage it's a bond, till the share
    price can increase and new equity can begin. Not a good
    situation for a growth company to be in.

    Since we
    can not raise accretive equity at this time PZN has
    no choice but to finish up it's existing business
    and wait. CPV is in this boat too. Their share price
    has to be over $20 in order to issue
    shares.

    PZN will be forced to curtail it's growth plans for
    next year, that seems quite obvious at this
    point.

    NewMK, I must admit at this time the REIT strategy must
    go. The structure is not being accepted and the
    timing is not right. I still generally like the idea,
    but when it turns a growth company into a bond it's a
    failure. I can't support it when it drastically hurts the
    comapnies future as it is now.

    Now the issues of
    competition from others and the anti-privatization movement
    become more real. What do the CCA salesmen say now when
    the Feds come knocking next year saying we're ready
    to go and PZN can't raise accretive equity. This is
    when I have to say it's time for a chance

 
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