| Title: | Market Investing |
| Moderator: | 2155::michaud |
| Created: | Thu Jan 23 1992 |
| Last Modified: | Thu Jun 05 1997 |
| Last Successful Update: | Fri Jun 06 1997 |
| Number of topics: | 1060 |
| Total number of notes: | 10477 |
Yesterday I recieved a letter from WANG. It said ---
WANG Laboratories has come out of Chapter 11 protection in September
1993.
Although the old Class B and Class C stock was canceled , warrants to
purchase Wang's new stock will be issued to former shareholders. Each
warrant entitles the holder to purchase one share of the new stock at
$21.45. That right will exist through july 2, 2001, and one warrant
will be distributed for appromimately 24 shares of the old stock held.
What does this really mean? Does this mean that if I send in 25 shares
of my old stock, I'll get one warrant in return? And with that warrant
I'll be able to buy one Wang stock? Over and above my 25 old Wang
stock, do I need to send in an additional $21.45 in cash? What is a
warrant? Why not jus give me one new stock for 24 of my old stocks?
Can anyone clear this fog I'm under?
| T.R | Title | User | Personal Name | Date | Lines |
|---|---|---|---|---|---|
| 843.1 | Warrant is like an option | HELIX::SPIELMAN | jerry dtn 297-4879 | Fri Mar 17 1995 01:31 | 13 |
I'm not familiar with the specifics of the Wang deal. However, in
general a "warrant" gives you the right to request to purchase a
specific amount of the stock of a company, at any time from some start
date (probably now) through some future end date. At the time you
decide to make the purchase, the warrant names the price you have to
pay. In general, when issued, the stock is worth less than what you
would have to pay. The hope is that in the future it will be worth more
and so you can decide when to actually make the purchase. In this case,
they are telling you the end date is sometime in 2001.
If you utlimately do nothing, it costs you nothing "additional".So a
warrant is kind of like an "option" on the stock.
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