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Metrocall Holdings, Inc. (MTOH) Message Board

  • nvest01 nvest01 Mar 29, 2004 9:59 AM Flag

    question... if the math is done on this

    merger where would the stock be trading at or a buy? I see this all over the place this m,orning.. from 68-72..... any ideas?

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    • It's pretty simple to track if you use this formula:
      AWIN share price * 1.876 * 2/3 + $75 * 1/3 = MTOH value.

      At a $33 per share AWIN price, you get:
      33 * 1.876 * 2/3 + 25 = $66.50

      At the current $69 share price, if taxes aren't a consideration and you want to own the combined company post-merger, you should be selling MTOH and buying AWIN, because you will recreate the deal for cheaper and own more of it.

      This is officially the worst deal I've ever seen announced by a selling company. If you consider what AWIN was trading at prior to announcement ($24/share), MTOH shareholders were offered $55/share for something that was trading at $74. EVEN WORSE, is that if you must take the cash portion or else you're screwing yourself. At this point, assuming the deal is approved, the move is to sell MTOH and buy AWIN. You'll own more shares and have more money leftover than you would by just holding MTOH through completion.

      Awful deal for MTOH owners (including me).

    • Buy or hold! The new stock should do well.

      • 1 Reply to raydon14yp
      • Raydon - come on now. All along you have been talking about the cash flow ability. If you are a MTOH shareholder you just got stiffed out of all of this years cash flow (its being used to buy yourself out in a twisted / perverse sort of deal). Plus - you get only 27.5% of future cash flow. Thus, the combined company better generate 3.5 times as much cash flow to make you, as a MTOH shareholder, whole.

        This deal is puke for MTOH shareholders.