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  • Idontwanttohearit Idontwanttohearit Jan 6, 2000 3:52 AM Flag

    Food for thought....

    In reading over the posts on this board, and at
    Reitmaster's Club site, it seems obvious that the deal PZN has
    entered into is abhorent to almost all shareholders. It
    is so blatently dishonest that even the least
    sophisticated or casual observer immediately is able to see
    many of the negatives involved.

    I cannot see
    how the lawyers can fail to tear PZN a new one with
    this deal! I've seen so many lawyers filing on
    companies, it is easy to become blase about their prospects,
    but few of those suits have the foundation of this
    case.

    So... I'm going to go out on a limb here and make a
    prediction. THIS DEAL WILL NOT BE CONSUMATED! As a matter of
    fact, I don't think this deal will ever be voted on.
    PZN will de-reit, being unable to pay dividends, but
    it will be forced into the slower-growth scenario
    that it would have been using with more prudent
    management anyway.

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    • I can't touch your finesse with figures! But I
      take the 9 month revenues of both companies as of 9/99
      and prorate a 4th quarter, then subtract 82%
      operating costs (roughly that of 96 and 97), 42 million
      investor cost and 38% taxes. Then I calculate an EPS on a
      24% dilution and a 20 PE and get around $5.6 per
      share. If revenues increase due to either increased
      occupancy or growth then things may look better. Very
      basic, I know. My point is that there are still unknowns
      and still possibilities. I am watching closely
      because no matter what ethics may be behind the deal, I
      don't think the group is stupid and IMO they know they
      need to show a reason why the plan should be accepted.
      I don't have my head in the sand--I'm watching
      closely and am well aware this could play out in a bad
      way. My question remains: why are there so many
      buyers?

      • 3 Replies to pkn4mom
      • Who is buying this stock and are we seeing any large block trades? Anyone?

      • I think you need to go way back to get a good
        perspective of whats happening today. CCA merged into PZN so
        the 4th quarter of 1998 was buried, I'm not going to
        tackle that one, though I know it what should be done,
        breaking it out of PZN 1999 statements. Check these out. I
        have combined CCA and PZN in both cases as PZN derives
        all of it's income from CCA. Bascally I just took out
        CCA leases and licenses fee payment (and removed it's
        1999 interest payment to PZN too.) We really need
        NewMK to do this but you'll get the
        idea.

        Est.1998 Combined CCA+PZN in millions


        ..................................% of total
        Rev
        Rev..................$663
        opert. exps..........$497.....75%

        drep(CCA+PZN..........$34
        G&A exp...............$22.4
        Total
        Exps...........$553.4....84%

        operat income.........$120.....18.1%
        Interest
        expense.......$11

        EBT...................$109
        taxes (32%)............$34.88

        Net
        Income.............$74.26
        eps....................$.90

        Est.1999 Combined CCA+PZN in
        millions

        ...............................% of total Rev
        Rev...............$495
        opert.
        exps........$361.........73%
        drep(CCA+PZN).......$48
        G&A
        exp.............$26

        Total Exps.........$435.........88%

        operat
        income.......$60.........12%
        Interest
        expense....$36

        EBT.................$24
        taxes (25%)..........$6
        Net
        Income..........$18
        eps................$.15


        NOw a few things. One, I believe rev. was down the
        4th in 1998, I put the rev. as flat for the quarter
        and used historical % of revenue as a guide to
        determine the other figures.

        For 1999 I extrapolated
        the 3rd quarter numbers coming out of CCA which were
        $365mm for 9 months.

        This stuff won't get me an
        analyst job at Goldman Sach but you get plainly see the
        issues we've been dealing with.

        Continued later
        part 2

      • Do you really think investors will give PZN a P/E
        of 20?? At least not before a couple of full
        quarters of results. Then we're looking at a $6.00 stock
        next October if all goes well. Geez... If this is the
        best plan they could come up with, maybe they ALL are
        as incompetent as Doc in negotiating with lenders.
        As I see it, from this conference call, they ARE as
        incompetent as Doc in dealing with PR, dealing with the
        analysts and shareholders. Maybe they ALL need to GO!

 
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