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Sprint Corporation Message Board

  • spectrum_guru spectrum_guru Feb 4, 2013 3:06 PM Flag

    Post Merger Price

    I see alot about this on the board full of idiots. You all think, dream or wish that it will be $7.30. I laugh at you and your mother because she snotted you out. The post merger price will be 33% less than pre merger price. WHY? Well because when sometjing that values 45% is converted into a new value of 30%, the dilution is 33%. The current price should help you a bit. If $5.70 holds then post merger will yield $4.00 shares... if you do the math and add what 55% at $7.30 and 45% at $4; you will come to anverage of $5.70 for EVERY share. It is no coincidence that the price has been in this range since announcment. The longs have made up their own BS here. NEVER listen to these morons... if you missed the rise from $4 to $5.70 then you already missed out on buyout premium.

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    • Gee're straight from the Sprint 8-K Filing:

      Transaction Terms
      • Provides stockholders the ability to realize an attractive cash premium or to hold shares in a stronger, better capitalized Sprint
      • Provides Sprint with $8.0 billion of primary capital to enhance its mobile network and strengthen its balance sheet
      • Enables Sprint to benefit from SoftBank’s global leadership in LTE network development and deployment
      • Improves operating scale
      • Creates opportunities for collaborative innovation in consumer services and applications
      • SoftBank will form a new U.S. subsidiary, New Sprint, which will invest $3.1 billion in a newly-issued Sprint convertible senior bond following this announcement. The
      convertible bond will have a 7-year term and 1.0% coupon rate, and will be convertible, subject to regulatory approval, into Sprint common stock at $5.25 per share.
      Immediately prior to the merger, the bond will be converted into shares of Sprint, which will become a wholly-owned subsidiary of New Sprint.
      • Following Sprint stockholder and regulatory approval, and the satisfaction or waiver of the other closing conditions to the merger transaction, SoftBank will further
      capitalize New Sprint with an additional $17 billion and effect a merger transaction in which New Sprint will become a publicly-traded company and Sprint will survive as
      its wholly-owned subsidiary. Of the $17 billion, $4.9 billion will be used to purchase newly issued common shares of New Sprint at $5.25 per share. The remaining $12.1
      billion will be distributed to Sprint stockholders in exchange for approximately 55% of currently outstanding shares. The other 45% of currently outstanding shares will
      convert into shares of New Sprint. SoftBank will also receive a warrant to purchase 55 million additional Sprint shares at an exercise price of $5.25 per share.
      • Pursuant to the merger, holders of outstanding shares of Sprint common stock will have the right to elect between receiving $7.30 per Sprint share or one share of New
      Sprint stock per Sprint share, subject to proration. Holders of Sprint equity awards will receive equity awards in New Sprint.
      • Post-transaction, SoftBank will own approximately 70% and Sprint equity holders will own approximately 30% of New Sprint shares on a fully-diluted basis.

    • The first three sentences of your post say a lot about one thing......YOU......

      Sentiment: Buy

    • Specturm is basically correct. There is probably a risk premium of about $0.25 - $0.50 per share based on risk that maybe the deal doesn't go through and/or is very delayed hence tying up investors money for 6-12 month. That risk premium is really the only gain we can expect from hold S.

      It is possible that they underlying performance of the company changes between now and when the merger takes place, and that would have an effect on the $4 est. value of the New Sprint shares. If it looks like they are really gaining some market share, etc., that would help the shares, and vice versa if performance deteriorates. Overall effect would be muted, however, because the 7.30 * 55% is a fixed amount, and you are just varying the value of the remainder.

    • spectrum_guru remember when you said this... :)
      "Your iphone 5 has a cdma chip only. Go spread your #$%$ elsewhere. IMPOSSIBLE"
      It works better if you change you ID with every post so you don't have a history.
      memory of jugs. peace be unto him.

    • Not correct,

      The new shares are issued at around $5.25 if memory serves me right.
      Average of new shares and purchase by SB is $6.30 or so,that's why the shares are trading slightly below the new average.

      Try again!

    • Yeah. This is my thinking as well give or take a little.

6.29-0.07(-1.10%)Oct 27 4:02 PMEDT