SPIN-OFF RESEARCH - Spin-Off Advisors_ L.L.C

Document Sample
SPIN-OFF RESEARCH - Spin-Off Advisors_ L.L.C Powered By Docstoc
					            SPIN-OFF
            Advisors, LLC
                                                                                        SPIN-OFF
                                                                                       RESEARCH
         August 2001                                      Table of Contents                                                                                                        Page
        Volume V Issue 8
                                                         ♦     2001 First Half Review ………………………………………….                                                                                  2
                                                         ♦     Updates: Canadian Pacific (CP) / Break-up      ………………….                                                                   4
                                                                          Pitney Bowes (PBI) / Pitney Office Systems ………….                                                               6

Joe Cornell, CFA                                         ♦     Spin-Off Announcement Calendar       …………………….…….                                                                         9
                                                         ♦     Calendar Highlights       …………………………………….…….                                                                              11
Mark C. Minichiello                                      ♦     Fresh Spin-Off Situations:
                                                                  ESS Technology (ESST) / Vialta (VLTA) ………………….                                                                         12
Kevin P. Hare, CPA                                                Millipore (MIL) / Mykrolis (MYK) ………………………….                                                                           13

                                                         ♦     Recently Announced Spin-Offs:
                                                                  Allegheny Energy (AYE) / Allegheny Energy Supply   ….                                                                  18
                                                                  Impco Tech (IMCO) / Quantum Technologies        ………….                                                                  19
                                                                  Mercury Air (MAX) / MercFuel      ………………………….                                                                          20
                                                                  Thermo-Electron (TMO) / Viasys Healthcare (VSS) ………….                                                                  21

                                                         ♦     Foreign Fresh Spin-Off Situations:
                                                                  Kingfisher (KGF LN) / Woolworths Group ………………….                                                                        23
                                                                  Sulzer AG (SUN VX) / Sulzer Medica (SMEN SW) ………….                                                                     24

                                                         ♦     Foreign Announced Spin-Off Situations
                                                                  Lufthansa (LHA GR) / SkyChefs      ………………………….                                                                         25

                                                         ♦     Potential Spin-Offs:
                                                                   Assicurazion Generali (G IM) / Real Estate ………………….                                                                   26
                                                                   British Telecom (BTY) / Azure       ………………………….                                                                       27
                                                                   Enron (ENE) / Wind Unit      ………………………………….                                                                           28
                                                                   Matsushita (6991 JP) / Information Technology ………….                                                                   29
                                                                   Palm (Palm) / Operating System      ………………………….                                                                       30
Spin-Off Advisors, L.L.C.                                ♦     Potential Spin-Off Watch List ……….....…….…...….…......….                                                                  31
                                                         ♦     Insider Transactions      ………………………….…….…......….                                                                         32
111 W. Jackson Blvd.
                                                         ♦     Analyst Coverage ………………………………………………….                                                                                     33
Suite 1146                                               ♦     Valuation Snapshots ………………….….………...…...…..….….                                                                           42
Chicago, IL 60604                                        ♦     Implied Values ……………….……….…...……….…….……..                                                                                 57
312-939-8900                                             ♦     Stub Monitor       …………………………………….…...…..……                                                                               62
                                                         ♦     Spin-Off Calendar by Date        ....………….…...….…...……..…                                                                 63
www.spinoffadvisors.com


Any recommendation contained in this report may not be suitable for all investors. Moreover, although the information contained herein has been obtained from sources believed to be reliable,
its accuracy and completeness cannot be guaranteed. In addition, Spin-off Advisors, L.L.C., a Registered Investment Advisor, and employees of Spin-off Advisors, L. L. C. may hold positions
or effect transactions contrary to recommendations mentioned herein. No copy of this report may be reproduced, copied, duplicated or electronically forwarded without the expressed written
permission of Spin-Off Advisors, L.L.C.

                         111 West Jackson Boulevard, Suite 1146, Chicago, Illinois 60604 : Phone: 312-939-8900 : Fax: 312-939-1417 : www.spinoffadvisors.com
2                                                                                                                        Spin-Off Research



                                  Review of 1st Half of 2001
Despite the less than accommodative equity market, the spin-off market was surprisingly active during the
first half of 2001 with 22 total spin-offs. Eight companies were fully separated Arbitron, Global Payments,
Marine Products, McData, Mirant, Roxio, Stratos Lightwave and Williams Communications. From that
group, 4 stocks were carved out previously in an IPO prior to being distributed; McData, Mirant, Stratos
and Williams Communications. There were also 10 new carve-outs in the first two quarters of 2001;
Agere, Aquila, FMC Technologies, Instinet, Kraft, Reliant Resources, Riverstone Networks, Shamrock
Logistics, SureBeam and Williams Energy LP.            In addition, there were two tracking stocks issued
(Rainbow Media Group and MCI-Group) both in the form of a dividend. There were two full “split-offs” or
exchange offers completed, Coach and AT&T Wireless.



                                                             Alphabetically
                                                                                        1st Day Spin-off    08/07/01 Spin-off Market Value
     Spin-Off                        Spin-O ff    Parent                              of Regular Price        PRICE     %        (000)
     Name                    Ticker T ype         Nam e                       T icker   Trading 1st Close             Change
1    Agere System s          AG R    Carve-O ut   Lucent                      LU         03/28/01 $  6.02   $    5.48    -9%    8,960,348
2    Aquila                  ILA     Carve-O ut   Utilicorp                   UC U       04/23/01 $ 27.85   $   27.17    -2%    2,663,339
3    Arbitron                AR B    Spin-O ff    Ceridian                    CE N       04/01/01 $ 23.26   $   26.95    16%      785,970
4    AT &T W ireless         AW E    Split-O ff   AT &T                       T          05/25/01 $ 18.09   $   17.72    -2%   40,981,930
5    Coach                   CO H    Split-O ff   Sara Lee                    SLE        04/05/01 $ 28.74   $   35.90    25%    1,562,117
6    G lobal P aym ents      G PN    Spin-O ff    National D ata              ND C       01/31/01 $ 21.20   $   31.97    51%    1,156,898
7    FM C Technologies       FTI     Carve-O ut   FM C Corp.                  FM C       06/14/01 $ 22.00   $   17.35   -21%    1,127,750
8    Instinet                IN ET   Carve-O ut   Reuters                     RT R LN    05/28/01 $ 17.65   $   13.73   -22%    3,280,097
9    Kraft                   KFT     Carve-O ut   Philip M orris              MO         06/12/01 $ 31.25   $   30.49    -2%   52,900,150
10   M arine Products        M PX    Spin-O ff    RP C                        RE S       03/01/01 $  4.80   $    4.90     2%          832
11   M cD AT A               M CD TA Spin-O ff    EM C                        EM C       02/08/01 $ 37.07   $   19.34   -48%    2,150,743
12   M irant                 M IR    Spin-O ff    Southern Com pany           SO         04/02/01 $ 34.70   $   31.38   -10%   10,652,882
13   Rainbow Media G roup    RM G    T racking    Cablevision                 CV C       03/30/01 $ 26.00   $   26.83     3%    2,350,120
14   Reliant R esources      RR I    Carve-O ut   Reliant E nergy             RE I       04/30/01 $ 33.00   $   21.25   -36%    6,205,000
15   Riverstone Networks     RS TN Carve-O ut     Cabletron                   CS         02/15/01 ######    $   14.80    11%    1,510,902
16   Roxio                   RO XI   Spin-O ff    Adaptec                     AD PT      05/11/01 $ 14.69   $   13.15   -10%      216,975
17   Sham rock Logistics     UD L    Carve-O ut   Ultram ar Diam ond Sham .   UD S       04/10/01 $ 28.00   $   31.25    12%      578,875
18   Stratos Lightwave       ST LW Spin-O ff      M ethode Electronics        M ET HA    04/30/01 $  7.99   $    6.45   -19%      413,393
19   Surebeam                SU RE Carve-O ut     T itan                      T TN       03/16/01 $  8.59   $   11.25    31%      628,290
20   W illiam s C om m .     W CG    Spin-O ff    W illiam s C om panies      W MB       04/23/01 $  4.20   $    2.10   -50%    1,026,619
21   W illiam s E nergy LP   W EG    Carve-O ut   W illiam s                  W MB       02/06/01 $ 24.70   $   30.70    24%      348,721
22   W orldCom               W C O M T racking    M CI-G roup                 M CIT      06/08/01 $ 18.30   $   11.96   -35%    1,375,400




Spin-Offs Positive Catalyst
We have also reviewed the 10 largest spin-offs in the last year. For the parent stock spinning out the
subsidiary, the event seems to be a positive catalyst. The motivations for a company to spin-off
subsidiaries vary, but spin-offs are often conducted to shrink the holding company discount to their sum-of-
the-parts breakup value. A spin-off of a major division typically narrows this discount. As the remaining
businesses are spun-off, transparency increases, and the difference between the sum-of-the-parts valuation
and current price shrinks.

In the one month following the spin-off, the parent’s share price trades up 7% on average. Standouts from
last year include Hewlett-Packard’s performance after spinning out Agilent and 3Com’s return in the one-
month period following the spin-off of Palm. Both Hewlett and 3Com were up more than 19% during the
one-month period following the spin-off.
Spin-Off Research                                                                                                                                                3




           In the case of most spin-offs, the float of the                                    On average, the largest 10 spin-offs from the last
           subsidiary increases substantially. Often, a parent                                year traded down 8.2% in the month following the
           company will conduct an IPO of subsidiary stock                                    spin. Overall, it seems the market reacts adversely
           and later spin the remainder to shareholders. For                                  to the large increase in float of the spun-out
           tax purposes, the parent company maintains 80% or                                  company and the temporary effect of institutional
           more of the voting interest in the subsidiary and                                  holders’ rebalancing positions. We view the first
           spins off the remaining shares to parent company                                   month as a good time to establish positions in new
           shareholders to facilitate the tax-free distribution.                              spin-offs.
           If the spun-off business is categorized in a separate
           sector than the parent company, shares may have to
           be sold by institutional holders with a narrow
           investing mandate.


            10 Largest Spinoffs June 2000 - June 2001

            Parent Company                          Spin Co                       Effective Date   Spin Co Market Cap              Spin Added Carve / Spin
                                                                                                   at Eff Date (1000's)            To S&P 500
            Hewlett Packard Co                      Agilent Technologies         06/02/00                  $33,594,866.00               Y     Carve
            3Com Corp                               Palm Inc                     07/27/00                  $20,310,952.00               Y     Carve / Spin
            Southern Co                             Mirant Corp                  04/02/01                  $12,017,698.00               Y     Carve
            Kansas City Southern                    Stilwell Financial           07/12/00                  $10,526,688.00               Y     Full Spin
            Lucent Technologies                     Avaya Inc                    10/02/00                   $6,492,657.00               N     Full Spin
            Williams Cos                            Williams Comm                04/23/01 (Spin)            $2,625,210.00               N     Carve / Spin
            WorldCom                                MCI                          06/27/01                   $2,605,500.00               N     Spin / Tracker
            HNC Software                            Retek                        09/29/00                   $2,236,559.00               N     Carve
            Cablevision                             Rainbow Media                03/30/01                   $2,198,760.00               N     Spin / Tracker
            Ford Motor Co                           Visteon Corp                 06/28/00                   $1,734,809.00               Y     Full Spin

            P a re n t C o m p a n y P o s t E ffe c tiv e D a te P e rfo rm a n c e                    S p in C o P o s t E ffe c tiv e D a te P e rf o rm a n c e

            P are n t C o m p a n y                            P a re n t 1 M o n th                    S p in C o                                 S p in 1 M o n th
                                                                 P erfo rm a n ce                                                                   P erfo rm a n ce
            H e w le tt P a c k a rd C o (H W P )                    1 9 .1 9 %                         A g ile n t T e c h n o lo g ie s (A )           0 .3 4 %
            3 C o m C o rp (C O M S )                                1 9 .5 9 %                         P a lm In c (P A L M )                          1 0 .9 9 %
            S o u th e rn C o (S O )                                  7 .6 7 %                          M ir a n t C o r p ( M IR )                     1 2 .2 6 %
            K a n s a s C ity S o u th e rn (K S U )                 1 7 .1 2 %                         S tilw e ll F in a n c ia l (S V )             -1 4 .0 6 %
            L u c e n t T e c h n o lo g ie s (L U )                -1 6 .1 0 %                         A v a y a In c ( A V )                         -4 4 .5 4 %
            W illia m s C o s (W M B )                               1 0 .8 6 %                         W illia m s C o m m ( W C G )                   -2 .0 5 %
            W o r ld C o m (W C O M )                               -2 0 .0 0 %                         M C I (M C IT )                                -1 0 .7 6 %
            H N C S o f tw a re (H N C S )                           2 3 .4 3 %                         R e te k (R E T K )                            -2 1 .9 0 %
            C a b le v is io n (C S )                                -3 .2 9 %                          R a in b o w M e d ia (R M G )                 -1 5 .7 4 %
            F o rd M o to r C o (F )                                 1 1 .9 8 %                         V is te o n C o rp ( V C )                       3 .3 0 %

            A v e rag e                                              7 .0 4 %                           A v e rag e                                     -8 .2 2 %
4                                                                                             Spin-Off Research

                                         Company Update

    Canadian Pacific Announces Spin-Off Structure
Canadian Pacific (Bloomberg: CP CN) announced           southeastern British Columbia produce primarily
that the company will hold a special meeting of         high-quality, metallurgical coal for the international
shareholders on September 26, 2001, to approve the      steel industry. Its operations in Alberta include two
plan of arrangement for its reorganization.             mines supplying thermal coal to electric utilities.
Following this meeting, PanCanadian Petroleum           Fording is also the world’s largest supplier of the
(Bloomberg: PCP CN), in which Canadian Pacific          industrial mineral wollastonite. Fording will have
holds about an 86% interest, will hold a meeting to     approximately 52.5 million shares outstanding. The
approve certain aspects of the plan of arrangement.     board of Fording anticipates that the company will
The plan of arrangement is scheduled to take effect     pay an initial quarterly dividend of C$0.125 per
on October 1, subject to shareholder approval,          Fording common share. Fording filed to trade on
favorable Canadian tax ruling, and other approvals      the Toronto and New York exchanges under the
(including the final approval of the Canadian           symbol “FDG”. On a pro-forma basis, FDG earned
courts). Each shareholder of Canadian Pacific           net income attributable to common shareholders of
common stock will receive the following share           C$43.5 million for the six-month period ended June
distribution in the five resulting public companies:    30, 2001, an increase of C$32 million (278%) over
                                                        the same period in 2000. Fording will be in New

                                                 Canadian Pacific


      PanCanadian            Fording            Canadian Pacific           CP Ships           Fairmont Hotels
        0.684 : 1            0.166 : 1             Railway                  0.25 : 1              0.25 : 1
                                                   0.50 : 1


PanCanadian Petroleum (PCP) is an energy                 York on August 14 for its roadshow. Contact Mark
company that explores, develops, produces and            Gow of Credit Suisse at (403) 260 – 9834 for more
markets natural gas, crude oil, natural gas liquids      information.
and electricity. PanCanadian’s core areas include
the Western Basin (Western Canada and US), East          Canadian Pacific Railway (CPR) provides rail and
Cost of Canada, Gulf of Mexico, and the UK. CP           intermodal freight transportation services over a
will distribute its 86% stake in PCP to CP               14,000-mile network extending from Montreal to
shareholders in the form of approximately 0.684          Vancouver, and through the U.S. midwest and
shares of PCP for each share of CP. After the            northeast. The company’s commercial alliances
distribution, PCP will have about 254.4 million          with other carriers extend CPR’s market reach
shares outstanding. Currently, PCP pays a quarterly      beyond its own network. Serving ports on the
dividend of C$0.10 per share. Subject to approval        Atlantic and Pacific coasts, CPR links North
by the PCP board and a favorable Canadian tax            America with European and Pacific markets. CPR
ruling, PCP intends to pay a special dividend of         will have about 158.2 million shares outstanding.
about C$1.18 billion (C$4.60 per share) to the PCP       The company’s board anticipates that CPR will pay
shareholders. On a pro-forma basis, PCP earned net       a quarterly dividend of about $0.127 per CPR
income attributable to common shareholders of C          common share. The company has filed to trade
$909.1 million for the six-month period ended June       under the symbol “CP” on the Toronto and New
30, 2001, an increase of C$528.2 million (139%)          York exchanges. On a pro-forma basis, CP earned
over the same period in 2000. Contact Audra Hyde         net income attributable to common shareholders of
at (403) 290 – 3284 for more information about           C$149.7 million for the six-month period ended
PCP and its roadshow.                                    June 30, 2001, a decrease of C$19.2 million (11%)
                                                         over the same period in 2000. For more information
Fording is Canada’s largest and lowest-cost              about CP Railway, contact Paul Bell at (403) 319 –
producer of export coal. Its three mines in              3591.
Spin-Off Research                                                                                                                                                                                           5



                                                                                                                                                       Bloomberg Est. Shares                            Quarterly
     CP Ships provides regional ocean and related inland                                                          Company                                Symbol  Out. (million)             Ratio       Dividend
     transportation services. CP Ships operates primarily in                                                      PanCanadian Petroleum                 PCP CN          254.4                0.684       C$0.10
                                                                                                                  Fording                               FDG CN            52.5               0.166      C$0.125
     the TransAtlantic, Australasian, Latin American, and                                                         Canadian Pacific Railway               CP CN          158.2                0.500      C$0.127
     Asian markets under six brand names: ANZDL,                                                                  CP Ships                              TEU CN            79.1               0.250       C$0.04
                                                                                                                  Fairmont Hotels & Resorts             FHR CN            79.1               0.250       C$0.05
     Canada Maritime, Cast, Contship Containerlines,
     Lykes Lines, and TMM Lines. CP Ships transports                                                               Thompson at (416) 874 –                                  Credit A
                                                                                                                                                                                    gency R
     nearly two million twenty-foot equivalent units (teu)                                                         2485      for    more                                          Complete eview
                                                                                                                                                                                           d
     per year, placing the company among the ten largest                                                           information on Fairmont
     ocean carriers in the world. The company expects to                                                                                                                    CPR cap
                                                                                                                   Hotels.                                                         ital stru
                                                                                                                                                                                 Complete cture
     pay a quarterly dividend of about $0.04 per share. The                                                                                                                                d
     company has filed to trade under the symbol “TEU” on                                                          To value CP, we looked                                   Investo
     the Toronto and New York exchanges. TEU should                                                                at two components: CP’s                                 August, r Road shows
                                                                                                                                                                                  and Septe
                                                                                                                                                                                           mber
     have about 79.1 million shares outstanding. On a pro-                                                         86% stake in PCP and
     forma basis, TEU earned net income attributable to                                                                                                                       Informati
                                                                                                                   the four other pieces in                                            on C
                                                                                                                                                                                 Mid -Aug ircular
     common shareholders of C$55 million for the six-                                                              CP. First of all, each                                                 ust
     month period ended June 30, 2001, an increase of C$1




                                                                                                                                                                                                                  Timeline
                                                                                                                   share of Canadian                                        When -Iss
                                                                                                                                                                                     ued
     million (2%) over the same period in 2000. Contact Liz                                                        Pacific has about US                                        Mid -AugTrading
                                                                                                                                                                                         ust
     Kenny at 011 – 417 – 0969 – 13764 for more                                                                    $24.50      worth     of
     information about CP Ships.                                                                                                                                                 Tax Ruli
                                                                                                                   PanCanadian Petroleum                                       Mid -Sep ng
                                                                                                                                                                                       tember
                                                                                                                   embedded in it. This
     Fairmont Hotels & Resorts (FHR), the new name for                                                                                                                      Shareho
                                                                                                                   implies that the stub is                                        ld
     Canadian Pacific following the completion of the                                                                                                                       Septemb er Approval
                                                                                                                   worth about $14.50. For                                          er 26, 20
                                                                                                                                                                                             01
     reorganization, is one of North America’s leading
                                                                                                                   these remaining parts,                                   Final Co
     owner/operator of luxury hotels and resorts. FHR’s                                                                                                                             urt
                                                                                                                   we calculated the equity                                 Septemb Approval
     portfolio consists of 77 luxury and first class properties                                                                                                                      er 28, 20
                                                                                                                                                                                              01
                                                                                                                   value of each by
     with more than 30,000 rooms in Canada, the US,                                                                                                                         Regular
                                                                                                                   calculating enterprise                                           -W
     Mexico, Bermuda, and Barbados. The company also                                                                                                                          October ay Trading
                                                                                                                   value from an estimated                                           3, 2001
     holds a 67% interest in Fairmont and a 100% interest
                                                                                                                   2001 EBITDA. The
     in Delta Hotels. In addition to hotel management, FHR
     holds real estate interests in 20 properties, a 34%                                                            equity value of each part of CP is the difference
     interest in the Legacy Hotels Real Estate Investment                                                           between each part’s enterprise value and debt. This
     Trust and other assets. The company anticipates paying                                                         sum of the parts analysis results in CP being worth
     a quarterly dividend of C$0.05 per new FHR. The FHR                                                            about US$44 per share.
     common stock will trade on the Toronto and New York
     exchanges under the symbol “FHR” and have about
     79.1 millions shares outstanding. On a pro-forma basis,
     FHR earned net income attributable to common
     shareholders of C$26 million for the six-month period
     ended June 30, 2001, a decrease of C$23.8 million
     (48%) over the same period in 2000. Contact Emma

                                                                                                                             C P 's          E q u it y   V a lu e p e r
                                                                                                                         O w n e r s h i p V a lu e p e r    s h a re
      D iv is io n                                                                                   S h a r e P r ic e P e r c e n ta g e   S h a re       (U S $ )
      P a n C a n a d ia n P e t r o l e u m ( B l o o m b e r g : P C P C N )                            C $ 4 3 .3 9             86%       C $ 3 7 .3 2 $    2 4 .4 6

                                                                                                                                           E q u it y   V a lu e p e r                         V a lu e o f
                                           E s t. 2 0 0 1 E V /E B IT D A        E n te r p r is e                         E q u it y    V a lu e p e r    s h a re    D is t r ib u t io n N e w ly Is s u e d
      D iv is io n                          E B IT D A      M u ltip lie r          V a lu e              D ebt            V a lu e        S h a re       (U S $ )         R a tio              S h a re s
      C P R a ilw a y ( C P )                 C $ 1 ,1 5 0            6 .5          C $ 7 ,4 7 5          C $ 3 ,2 2 9      C $ 4 ,2 4 6   C $ 1 3 .4 2 $      8 .8 0            0 .5 0 0   $         1 7 .5 9
      C P S h ip s ( T E U )                        400               5 .5              2 ,2 0 0               153             2 ,0 4 7         6 .4 7         4 .2 4            0 .2 5 0             1 6 .9 6
      F o rd in g ( F D G )                         250               5 .0              1 ,2 5 0                 93            1 ,1 5 7         3 .6 6         2 .4 0            0 .1 6 6             1 4 .4 4
      F a ir m o n t H o t e l ( F H R )            325               8 .5              2 ,7 6 3               598             2 ,1 6 5         6 .8 4         4 .4 9            0 .2 5 0             1 7 .9 4

      T o ta l V a lu e                                                                                                                     C $ 6 7 .7 1 $    4 4 .3 8




      C P S h a r e s o u ts ta n d in g      3 1 6 .3 4 3 m illio n s
      U S $ /C $ E x c h a n g e                0 .6 5 5 4
6                                                                                              Spin-Off Research

                                      Company Update

            Pitney Bowes to Spin-Off Office Systems
Pitney Bowes (NYSE: PBI, $41.90) anticipates the         sold, rented or financed by the company, while
spin-off of Pitney Bowes Office Systems will be          supplies and services are sold.
completed in September of 2001. Pitney Bowes
Office Systems will trade on the NYSE under the          Pitney Bowes Office Systems will receive $165
ticker “PBO” and consist of the slower growing           million in debt from Pitney Bowes at the time of the
businesses of Pitney Bowes U.S. and U.K. Office          spin-off. Pitney Bowes Office Systems posted $642
Systems operations. The stock distribution ratio has     million in revenue for 2000 and net income of
not been determined, as of the end of July, and we       $62.8 million. Net income margins decreased in
expect the ratio to be one share of Office Systems       2000 to 9.7% from 14.6% in 1999.
for about ten shares or greater of Pitney Bowes.
The record and distribution dates should be
                                                         Pitney Bowes provides mailing and integrated
determined in August. Pitney Bowes has received a
                                                         logistics, office solutions, and capital services.
private letter ruling from the Internal Revenue
                                                         Mailing and integrated logistics include the rental
Service for tax-free status of the spin-off.
                                                         of postage meters and the sale and financing of
                                                         mailing equipment, including software-based mail
S&P 500
                                                         creation and mail finishing equipment, production
Pitney Bowes has a market capitalization of about
                                                         mail systems including customized software
$10 billion and is a member of the S&P 500. We
                                                         a p p lications, software-based shipping,
expect Pitney Bowes to remain in the index post
                                                         transportation and logistics systems, and related
spin-off. However, Pitney Bowes Office Systems
                                                         supplies and services. Facilities management
will have a much smaller market capitalization
                                                         services provide mail processing, reprographic
(street estimates around $400 million or about
                                                         business support and document resource-planning
$1.55 per Pitney Bowes share) and will not be
                                                         functions. Capital services include large-ticket
included in the index. We anticipate selling
                                                         financing and fee-based programs covering a broad
pressure from indexers re-balancing their portfolios
                                                         range of products and other financial services to the
and from structural issues associated with the spin-
                                                         commercial and industrial markets in North
off (i.e. 1: ~10 distribution ratio, small market cap.
                                                         America. The spin-off should help Pitney Bowes’
and no dividend).
                                                         earning visibility.
The environment in which Pitney Bowes Office
                                                         On July 17, Pitney Bowes announced second
Systems operates is extremely competitive.
                                                         quarter results that included diluted earnings per
Casualties of this environment include Lanier
                                                         share from continuing operations of 58 cents, an
Worldwide, a spin-off Harris Corp. recently
                                                         increase of three percent, excluding both special
acquired by Ricoh, and Xerox, which has been
                                                         gains and charges. Revenue grew two percent to
struggling the last several years. Once the spin-off
                                                         $1.02 billion. Excluding both special gains and
is complete, Pitney Bowes will continue to provide
                                                         charges, income from continuing operations was
Office Systems customers with convenient access
                                                         $144.6 million. Compared to year 2000 results, the
to leasing and financial services, while Office
                                                         company expects revenue growth of approximately
Systems will continue to provide fax and copier
                                                         four to six percent for the second half of the year,
systems for Pitney Bowes.
                                                         prior to the inclusion of any revenues from their
Office Systems includes revenues from the sale,          recently announced acquisitions.
financing, rental and service of reprographic and
facsimile equipment including related supplies, and      Diluted earnings per share from continuing
facilities management services which provides mail       operations which include Global Mail, Enterprise
processing, reprographic business support and            Solutions and Capital Services are expected to be in
document resource planning functions. Products are       the range of $0.59 to $0.60 cents for the third
Spin-Off Research                                                                                                                                                                                                              7



           quarter 2001 and $2.35 to $2.37 for the full year.
           Pitney Bowes should generate about $450 million
           in free cash flow in 2001 from continuing
           operations or $1.74 per share. However, we should
           point out that there have been several one-time
           charges and restructuring expenses this year that
           may have shielded Pitney Bowes true performance.


                                                                                         Peer Valuation




                                                                                                                                                   s
                                                                                                                                                tem
                                                                                                                                             Sys




                                                                                                                                                                                                                    TEM
                                                                                                                                       ffice
                                                                                 INC




                                                                                                                                                                                                                  SYS
                                                                                                                                     sO
                                                                                ES




                                                                                                                                                                  RP
                                                                                                      A




                                                                                                                                                                                         CE
                                                                              BOW




                                                                                                                                  owe
                                                                                                     TS




                                                                                                                                                                                                              BUS
                                                                                                                                                                CO




                                                                                                                                                                                      FFI
                                                                                                 POS




                                                                                                                              ey B
                                                                         NEY




                                                                                                                                                             OX




                                                                                                                                                                                    NO




                                                                                                                                                                                                             KA
                                                                                               NEO




                                                                                                                                                                                                           DAN
                                                                                                                                                          XER
                                                                                                                          Pitn




                                                                                                                                                                                 IKO
                                                                        PIT




             C om pany
             T ic k e r                                                PBI                 NEO FP*                      P B O **                        XRX                     IK N                 DNK LN                A v e ra g e
             C u r r e n t Im p lie d P r ic e                  $           4 1 .6 1              3 1 .1 6          $      1 5 .0 0            $                8 .2 2      $          7 .3 3      £       0 .1 4
             S h a r e s O u t. ( 0 0 0 ,0 0 0 )                            2 5 8 .6                3 0 .3                   2 5 .9                           6 6 7 .6               1 4 8 .3            2 3 4 .1
             M a r k e t C a p ( 0 0 0 ,0 0 0 )                 $    1 0 ,7 6 0 .4 3            9 4 4 .3 1          $    3 8 7 .9 0            $         5 ,4 8 7 . 5 2     $   1 ,0 8 7 .2 4      £     3 1 .8 4
             E n te r p r is e V a lu e ( 0 0 0 ,0 0 0 )        $    1 3 ,8 2 5 .9 6         1 ,2 3 0 .7 1          $    5 5 2 .2 0            $       2 1 ,6 8 5 .5 2      $   4 ,5 1 2 .1 1      £   6 2 5 .4 6

             EPS
             T T M E s t. / P r o F o r m a ( d ilu te d )      $               2 .2 9              1 .1 9          $        2 .1 6            $               ( 0 .5 4 )   $          0 .5 3      £             0 .0 3
             T T M P /E                                                       1 8 .1 7            2 6 .3 0                   6 .9 3                                -                 1 3 .8 3                    5 .0 4           6 .2 9

             2 0 0 1 E ( D ilu te d )                           $               2 .3 6              1 .1 3          $        1 .1 8            $               ( 0 .0 7 )   $          0 .5 5
             F o r w a r d P /E                                               1 7 .6 5            2 7 .7 0                 1 2 .7 1                                -                 1 3 .3 3

             E n te r p r is e
             E n te r p r is e V a lu e / E B IT D A                          1 1 .4 6            1 0 .8 6                   3 .0 8                           2 5 .6 3               1 1 .9 6                  6 .1 7           1 4 .5 9
             E n te r p r is e V a lu e / E B IT                              1 5 .1 3            1 7 .3 6                   5 .3 0                                                  2 3 .2 5                3 3 .5 7           2 8 .4 1

             1 2 M o n th T r a ilin g
             T r a ilin g S a le s                              $     3 ,4 5 0 .1 1              4 3 7 .8 0         $    6 3 6 .8 6            $       1 8 ,3 6 3 .0 0      $   5 ,4 4 9 .2 4           £ 1 ,5 4 8 .8 3
             P r ic e to S a le s                                            3 .1 2                  2 .1 6                  0 .6 1                             0 .3 0                 0 .2 0                   0 .0 2            0 .1 7

             M a r g in s
             G r o s s M a r g in                                        5 5 .9 9 %                                      5 6 .7 3 %                         4 6 .1 4 %            3 7 .1 5 %               3 5 .3 6 %
             O p e r a tin g M a r g in                                  1 9 .3 4 %              1 6 .1 9 %              1 6 .3 7 %                          - 0 .3 3 %             3 .5 6 %                 1 .2 0 %
             E B IT D A M a r g in                                       3 4 .9 6 %              2 5 .8 8 %              2 8 .1 7 %                            4 .6 1 %             6 .9 2 %                 6 .5 4 %
             P r e ta x M a r g in                                       2 2 .4 7 %              1 0 .7 4 %              1 4 .5 3 %                            3 .3 4 %             2 .6 2 %                 1 .2 6 %
             N e t P r o fit M a r g in                                  1 7 .1 2 %                7 .0 4 %                8 .7 9 %                            0 .9 6 %             1 .5 4 %                 0 .6 9 %
             E ffe c tiv e T a x R a te                                  3 1 .0 0 %              3 4 .2 6 %              3 9 .5 3 %                         6 7 .2 6 %            4 4 .2 5 %               4 4 .9 4 %

             B o o k V a lu e                                   $              4 .9 9                 5 .9 5        $      1 0 .6 9            $                5 .2 5      $           9 .6 6     -£           0 .5 2
             P r ic e to B o o k                                               8 .3 4                 5 .2 4                 1 .4 0                             1 .5 7                  0 .7 6                ( 0 .2 6 )          0 .6 9

             T u r n o v e r 's
             A c c o u n t R e c . T u rn o ve r                                1 .8 5                 5 .0 4                                                   2 .2 4                  3 .2 0                   4 .6 0
             C u rre n t A s s e t T u rn o v e r                               1 .5 1                 1 .2 5                2 .0 6                             1 .3 3                  2 .0 7                   2 .5 9
             W o r k in g C a p ita l T u r n o v e r                         ( 5 .3 3 )             ( 3 .6 2 )              2 .6 9                             2 .5 7              ( 4 5 .4 9 )                 5 .7 4

             R e tu r n s
             R e tu r n o n A v e r a g e E q u ity                                              2 3 .6 8 %              4 0 .5 0 %                           4 .3 7 %               5 .8 6 %               - 7 .8 8 %
             P re -T a x A ve ra g e R O A                                 8 .7 0 %                9 .1 1 %              3 9 .9 8 %                         - 0 .2 0 %               3 .0 8 %                 2 .1 6 %
             R e tu r n o n A v e r a g e A s s e ts                       7 .7 0 %                3 .9 6 %              2 1 .4 7 %                           0 .5 9 %               1 .3 3 %                 1 .2 4 %
             R e tu r n o n C a p ita l                                  1 6 .0 5 %                9 .4 2 %                                                   1 .2 5 %               2 .6 1 %                 8 .4 5 %

             C u r r e n t R a tio                                             0 .7 8                 0 .7 4                 4 .2 8                             2 .0 7                  0 .9 6                   1 .8 2
             Q u ic k R a tio                                                  0 .6 6                 0 .3 5                 1 .6 8                             1 .4 8                  0 .7 1                   1 .0 7

             D e g r e e o f F in . L e v . ( E B IT /E B T )                  1 .1 8                 1 .5 1                 1 .1 3                            ( 0 .1 0 )               1 .3 6                  0 .9 6            0 .7 4
             F in . L e v . ( A s s e ts /E q u ity )                          5 .8 8                 4 .4 9                 1 .8 9                              8 .3 3                 4 .4 9                ( 6 .6 1 )          2 .0 7

             T o ta l D e b t to T o ta l C a p ita l                    7 6 .9 3 %              6 6 .2 7 %              3 7 .3 8 %                         8 9 .4 0 %            7 1 .2 1 %              1 6 7 .0 0 %            1 .0 9
             T o ta l D e b t to B o o k E q u ity                     2 5 2 .9 0 %            1 9 6 .5 1 %              5 9 .6 9 %                       5 3 7 .8 6 %          2 4 7 .3 0 %            - 5 1 8 .2 3 %            0 .8 9
             D e b t to E n te r p r is e V a lu e                       2 3 .6 0 %              2 8 .7 9 %              2 9 .8 8 %                         8 6 .9 3 %            7 8 .5 0 %              1 0 1 .4 2 %            0 .8 9
             L ia b ilitie s to E q u ity                              5 0 9 .0 9 %            3 4 8 .8 1 %              8 8 .6 2 %                       7 3 3 .0 1 %          3 4 9 .2 9 %            - 7 6 0 .8 9 %            1 .0 7

             NOTES:
              D u e t o r e c e n t a c q u is it io n s m a d e b y P it n e y B o w e s , c e r ta in b a la n c e s h e e t ite m s h a v e b e e n e x tr a p o la te d .
              * N e o p o s t d e n o m in a t e d in E u r o s .
              * * P it n e y B o w e s O f f ic e S y s te m s a s s u m e s a 1 : 1 0 d is tr ib u t io n r a t io .
8                                                                                                                  Spin-Off Research




                                               Valuation Graphs
                       om
            Parent andC parables                                                       ff   om
                                                                                 Spin-O andC parables

                             /E ultiple
                         TTMP M                                                            TTMP/EMultiple


    30.00                                         26.30         16.00                               13.83
    25.00                                                       14.00
               18.17                                            12.00
    20.00                                                       10.00
    15.00                                                        8.00     6.93                                              6.29
                                                                 6.00                                              5.04
    10.00
                                                                 4.00
     5.00                                                        2.00                -
      -                                                           -
                PBI                             NEOFP*                   PBO**       XX
                                                                                     R               IKN         DN LN
                                                                                                                   K       Average
                                  Ticker                                                            Ticker



                EnterpriseValueMultiples                                           EnterpriseValueMultiples

    20.00                                                       30.00
                                                                25.00
    15.00
                                                                20.00
    10.00                                                       15.00
                                                                10.00
     5.00
                                                                 5.00
     -                                                            -
                PBI                               O
                                                NE FP*                   PBO**       XX
                                                                                     R               IKN           K
                                                                                                                 DN LN     Average
                                  Ticker                                                            Ticker

            Enterprise Value / EBITDA Enterprise Value / EBIT                               Enterprise Value / EBITDA


                       Price toB M
                                ook ultiple                                                       ook ultiple
                                                                                         Price toB M


    10.00                                                       2.00
                8.34                                                                 1.57
                                                                          1.40
     8.00                                                       1.50

     6.00                                         5.24          1.00                                 0.76                   0.69
     4.00                                                       0.50

     2.00                                                        -

     -                                                          (0.50)                                            (0.26)
                PBI                             NE FP*
                                                  O                      PBO**       R
                                                                                     XX              IKN         DN LN
                                                                                                                    K      Average
                                  Ticker                                                            Ticker



                       Price toS M
                                ales ultiple                                                      ales ultiple
                                                                                         Price toS M


    3.50       3.12                                             0.70     0.61
    3.00                                                        0.60
    2.50                                          2.16          0.50
    2.00                                                        0.40                0.30
    1.50                                                        0.30                                0.20                    0.17
    1.00                                                        0.20
    0.50                                                        0.10                                              0.02
     -                                                           -
               PBI                              NE FP*
                                                  O                      PBO**      R
                                                                                    XX               IKN         DN LN
                                                                                                                   K       Average
                                  Ticker                                                            Ticker
Spin-Off Research                                                                                                          9

                                ANNOUNCEMENT CALENDAR
                                                   Announced
          Company                         Symbol     Date       Spin-Off                                      Symbol     Type
          ACACIA RESEARCH             ACRI          11/22/00   COMBIMATRIX                                    CBMX
          ADAPTEC                     ADPT                     ROXIO                                          ROXI         SP
          AETNA                       AET           07/20/00   AETNA HEALTHCARE                               AET          SP
          ALLEGHENY ENERGY            AYE                      ALLEGHENY ENERGY SUPPLY                                     SP
          AMCOL INTL                  ACO           12/27/00   NANOCOR UNIT
          AON                         AOC           04/20/01   COMBINED SPECIALTY CORP.                                    SP
          AT&T                        T             10/25/00   AT&T BROADBAND                                              SP
          AT&T                        T             10/25/00   AT&T WIRELESS                                  AWE        TR/SP
          AT&T                        T             11/15/00   LIBERTY MEDIA                                  LMG.A/B    TR/SP
          AVENTIS                     AVE           11/15/00   AGRICULTURAL BUSINESS                                       CO
          BELLSOUTH                   BLS           04/05/00   CINGULAR WIRELESS                                           CO
          BELLSOUTH                   BLS           03/29/00   LATIN WIRELESS                                            IPO/TR
          BRISTOL-MYERS SQUIBB        BMY           02/22/01   ZIMMER HOLDINGS                                ZMH
          BRITISH TELECOM             BTY                      BT WIRELESS                                                 CO
          BRITISH TELECOM             BTY                      YELL                                                        CO
          CABLEVISION SYSTEMS         CVC           12/22/99   RAINBOW MEDIA GROUP                            RMG          TR
          CABLETRON SYSTEMS           CS            02/10/00   RIVERSTONE NETWORKS                            RSTN       CO/SP
          CERIDIAN                    CEN           07/18/00   ARBITRON                                       ARB          SP
          CMS ENERGY                  CMS           10/03/00   CMS OIL & GAS                                               CO
          COMPUTER ASSOCIATES         CA            08/07/00   SOFTWARE AND SERVICES                                       SP
          CONEXANT SYSTEMS            CNXT                     SPINCO –Withdrawn S-1 plan straight spin-off                SP
          CONTINENTAL AIRLINES        CAL           07/09/01   EXPRESSJET                                     XJET       CO/SP
          COREL                       CORL          01/22/01   LINUX DISTRIBUTION UNIT                                     SP
          DELUXE                      DLX           01/31/00   eFUNDS                                         EFDS       CO/SP
          DIAGEO PLC                  DEO           06/22/00   BURGER KING                                                 CO
          DUN & BRADSTREET            DNB           12/15/99   MOODY’S                                        MCO          SP
          EASTMAN CHEMICAL            EMN           02/05/01   SPECIALTY CHEMICAL and PLASTICS                             SP
          EATON CORP.                 ETN           02/24/00   AXCELIS TECHNOLOGIES                           ACLS       CO/SP
          ECI TELECOM                 ECIL          08/03/00   MULTIPLE UNITS
          EMC Corp.                   EMC           05/31/00   MCDATA                                         MCDT       CO/SP
          ENRON                       ENE                      NEWPOWER HOLDINGS                              NPW          CO
          ESS TECHNOLOGY              ESST          07/20/00   VIALTA                                                      CO
          FLUOR                       FLR           06/08/00   MASSEY ENERGY                                  MEE          SP
          FMC Corp                    FMC                      FMC TECHNOLOGIES                               FTI          CO
          GENZYME GENERAL             GENZ                     GENZYME BIOSURGERY                                          TR
          GLOBAL CROSSING             GX            05/23/00   ASIA GLOBAL CROSSING                           AX           CO
          GREAT LAKES CHEMICAL        GLK           09/20/99   OSCA                                           OSCA      CO /SPLIT
          GREAT UNIVERSAL             GUS LN        12/05/00   BURBERRY UNIT                                               CO
          HEWLETT-PACKARD             HWP           03/02/99   AGILENT TECHNOLOGIES                           A          CO/SP
          iGATE CAPITAL               IGTE          03/07/00   MULTIPLE UNITS                                              CO
          ICN PHARMACEUTICALS         ICN           06/15/00   RIBAPHARM                                      RIBA         CO
          ICN PHARMACEUTICALS         ICN           06/15/00   INTERNATIONAL OPERATIONS                                    CO
          IMPCO TECHNOLOGY            IMCO                     QUANTUM TECHNOLOGY                                          SP
          INNOGY HOLDINGS             IOG           04/02/01   REGENESYS                                                   CO
          INSIGHT ENTERPRISES         NSIT          12/13/00   DIRECT ALLIANCE                                           CO/SP
          JOHNSON & JOHNSON           JNJ           05/23/01   INVERNESS MEDICAL                              IMA          SP
          KANSAS CITY SOUTHERN IND.   KSU           02/03/98   STILWELL FINANCIAL                             SV           SP
          KINGFISHER                  KFG LN                   WOOLWORTHS GROUP                                            SP
10                                                                                                    Spin-Off Research


                     ANNOUNCEMENT CALENDAR
                                               Announced
Company                              Symbol       Date         Spin-Off                     Symbol         Type


LUCENT TECHNOLOGIES                 LU           03/01/00      AVAYA                        AV               SP
LUCENT TECHNOLOGIES                 LU           06/00/00      AGERE SYSTEMS                AGR          CO/SPLIT
LUFTHANSA                           LHA GR                     SKYCHEFS                     CO
MARSHALL & ILSLEY                   MI           07/13/00      METAVANTE                    MVNT          CO/SP
MERCURY AIR                         MAX                        MERCFUEL                                   CO/SP
METHODE ELECTRONICS                 METHA        02/23/00      STRATOS LIGHTWAVE            STLW           CO/SP
NATIONAL DATA                       NDC          12/21/99      GLOBAL PAYMENTS              GPN              SP
NATIONAL SERVICE INDUSTRIES         NSI          06/28/01      LIGHTING & EQUIPMENT                          SP
NEC                                 6701 JP                    NETWORK CHIP BUSINESS                         SP
NETWORK ASSOCIATES                  NETA         01/31/00      INTERNET DIVISION
NEXTEL COMMUNICATIONS               NXTL         08/18/00      NEXTEL INTERNATIONAL         NXTI            CO
NOVELL                              NOVL         02/02/01      VOLERA                                        SP
XCEL ENERGY                         XEL          03/29/00      NRG ENERGY                   NRG             CO
PHARMACIA                           PHA          08/30/00      MONSANTO                     MON             CO
PITNEY BOWES                        PBI          12/11/00      OFFICE SOLUTIONS                              SP
QUALCOMM                            QCOM         07/25/00      SEMICONDUCTOR BUSINESS                        SP
RELIANT ENERGY                      REI          07/27/00      RELIANT RESOURCES            RRI            CO?SP
REUTERS GROUP PLC                   RTR LN       02/08/01      INSTINET GROUP               INET            CO
RPC                                 RES          01/14/00      MARINE PRODUCTS              MPX              SP
ROCKWELL INTERNATIONAL              ROK          12/08/00      ROCKWELL COLLINS             COL              SP
SARA LEE                            SLE          05/30/00      COACH                        COH            SPLIT
SONY                                SNE          12/06/00      INTERNET UNIT                                TR
SOUTHERN COMPANY                    SO           04/17/00      MIRANT                       MIR            CO/SP
SPHERION                            SFN          01/00/01      MICHAEL PAGE INTERNATIONAL   MPI LN          IPO
SPX CORP.                           SPW          06/05/00      INRANGE TECHNOLOGIES         INRG            CO
ST. JOE COMPANY                     JOE          10/27/99      FLORIDA EAST COAST IND.      FLA              SP
STARBUCKS                           SBUX         03/14/01      STARBUCKS JAPAN
SULZER AG                           SUN VX                     SULZER MEDICA                SMEN SW          SP
APOGENT                             AOT          04/24/00      SYBRON DENTAL SPECIALTIES    SYD              SP
TELEFÓNICA                          TEF          11/22/00      TELEFÓNICA MÓVILES           TEM             CO
THERMO ELECTRON                     TMO          01/31/00      THERMO FIBERTEK              TFT            CO/SP
THERMO ELECTRON                     TMO          01/31/00      VIASYS HEALTHCARE            VSS              SP
TITAN CORP                          TTN          08/14/00      SUREBEAM                     SURE           CO/SP
TV AZTECA                           TZA          11/15/00      UNEFON WIRELESS                              CO
ULTRAMAR DIAMOND SHAMROCK           UDS          08/14/00      SHAMROCK LOGISTICS           UDL             CO
UNITED PAN-EUROPE                   UPCOY        12/ /00       UPC GERMANY                                  CO
USX – MARATHON OIL GROUP            MRO          04/24/01      USX-US STEEL GROUP           X              TR-SP
UTILICORP UNITED                    UCU          12/22/00      AQUILA                       ILA            CO/SP
VERIZON COMM.                       VZ           04/10/00      GENUITY                      GENU            CO
WESTERN RESOURCES                   WR           03/29/00      WESTAR ENERGY                                 SP
                    {SP} Spin-Off             {CO} Carve-out              {TR} Tracking     {SPLIT}   Split-Off
Spin-Off Research                                                                                                               11



                                                       Calendar Highlights

       Price (08/07/01):     $63.29                              Listed                                     Date        Tax
                                      Parent            Symbol   Options   Spin-Off                       Announced    Exempt   Ratio
       Shares Out.          549.6
       Market Cap           $34.8 B
                                      General Motors    GM           Y     Hughes Direct TV


                                      EchoStar Communications Makes $32 B Unsolicited Offer for Hughes
                                      On August 2, in a letter to General Motor’s Board, EchoStar Communications made an
       Price (08/07/01):    $19.98
                                      unsolicited offer to combine Hughes’ satellite assets with that of EchoStar’s for $32.3 bil-
       Shares Out.           1.29 B   lion in an all stock swap, tax-free ($30.4 billion of equity and the assumption of $1.9 bil-
       Market Cap           $ 25 B    lion of debt) proposal. EchoStar would issue 0.75 of its shares in exchange for each
                                      Hughes share (1.299 outstanding plus 64 million shares for AOL cvt debt and 66 million
                                      stock options). Under the terms of the offer, GM and Hughes shareholders would own
                                      approximately 66% of the combined entity on a fully diluted basis.

                                      With EchoStar closing at $30.44 on Friday, this offer values Hughes at $22.83 per share,
                                      an 18% premium from Hughes’ closing price of $19.36. Removing Hughes’ non-DBS
                                      assets, EchoStar’s offer implies a $2,300 valuation per estimated yearend 2001. Accord-
                                      ing to EchoStar’s management, through incremental revenue opportunities ($20 billion)
                                      and cost savings ($36 billion), a Hughes/EchoStar combination would result in synergies
                                      with a net present value of $56 billion.




       Price (08/07/01):   $67.56                                Listed                         Date        Spin-Off    Tax

       Shares Out.          760.4 M Parent              Symbol   Options   Spin-Off           Announced       Date     Exempt   Ratio
       Market Cap           $51.4 B
                                      Qualcomm          QCOM        Y      Semiconductor        7/00
                                      On July 24, Qualcomm canceled its plan to spin-off its semiconductor business. The com-
                                      pany also said that Richard Sulpizio resigned as president and COO. Qualcomm said that
                                      the company does not need to spin-off the division because there is less potential for legal
                                      conflicts between divisions than originally expected. Qualcomm intended for the spin-off
                                      to gain reasonable access as a separate company to third party intellectual property
                                      through cross-license agreements to supply multi-mode integrated circuits. Since an-
                                      nouncing the spin-off in July 2000, Qualcomm has entered about 40 license agreements
                                      that enable the company to supply multi-mode integrated circuits and system software un-
                                      der each of the agreements. By entering the agreements, Qualcomm has been able to mini-
                                      mize potential patent litigation that may have arisen if the company were to sell multi-
                                      mode chipsets.


                                      Qualcomm Inc. develops and delivers digital wireless communications products and serv-
                                      ices based on the company's CDMA digital technology. The company's business areas
                                      include integrated CDMA chipsets and systems software, technology licensing, Eudora
                                      email software for Windows and Macintosh platforms, and satellite based systems includ-
                                      ing Omnitracs and Globalstar systems.
12                                                                                       Spin-Off Research



                                    Fresh Spin-Off Situations
                       ESS Technologies to Spin-Off Vialta
     ESS Technologies (NASDAQ: ESST) is going to spin-          players) and super VCDs. ESS has bundled a web
     off its majority-owned subsidiary, Vialta, Inc, through    browser, email application and set top box controls
     a distribution of all of its 51 million shares of Vialta   into many of its chips, permitting ESS customers to
     class A common stock to ESS shareholders. ESS share-       build DVDs that allow the user to access the Internet
     holders will receive 1.208 shares of Vialta class A        on television, send and receive e-mail and play DVDs
     common stock for each share of ESS common stock            from a single player. ESS began kdevelopment of its
     held on July 23. ESS anticipates that the distribution     own proprietary set top box as part of a strategy to pro-
     will occur on or about August 10. Immediately follow-      mote new applications for its multi-function chip. To
     ing the distribution, the holders of the distributed       fund development of this product line, ESS established
     shares will own approximately 56% of the outstanding       Vialta as a subsidiary. Vialta sold shares of its capital
     shares of Vialta capital stock. Existing Vialta share-     stock to ESS and private investors, including some ESS
     holders will hold the remaining shares. ESS will not       management. Currently, ESS has a share price of
     issue fractional shares. Fractional shares will be         $14.00 for a market capitalization of $597.38 million.
     rounded up to the nearest whole share. After the distri-
     bution, ESS will not own any shares of Vialta’s capital    Vialta Inc. developed a multi-purpose DVD player
     stock. Shares of Vialta are going to trade on the OTC      (ViDVD) that offers Internet access and other features
     Bulletin Board under the symbol “VLTA”. Shares of          (CD, MP3, karaoke, and support for other audio and
     Vialta are also expected to trade in the when-issued       video formats). This ViDVD is the first product offer-
     market under the symbol “VLTAV” on or before the           ing from Vialta’s “ “Digital Home System” platform.
     record date.                                               Vialta intends to begin shipments of ViDVD through
                                                                retail distribution channels in August 2001. Since its
     Before the spin-off, Vialta recapitalized its capital      inception, Vialta has been in the developmental stage.
     stock into two classes: class A and class B. Class A       The company will continue to operate in the stage for
     common stock has 3.8 votes per share; class B common       the immediate future. Currently, the company does not
     stock has 1 vote per share. ESS is seeking a ruling        have any revenues, has incurred only losses, and nega-
     from the IRS for the distribution to qualify as a tax-     tive cash flows from operations. These will continue as
     free distribution but does not know whether it will        the company begins to launch its product because of
     receive one. If the IRS issues one, the class B share-     additional expenses from marketing plus expansion of
     holders have agreed not to sell any of their shares for    operations and products.
     180 days after the distribution. If ESS fails to receive
     the ruling, the distribution will be taxable to ESS        ESS is conducting the spin-off to increase the transpar-
     shareholders. Additionally, Vialta’s common stock will     ency of the companies, to give Vialta direct access to
     not necessarily have two classes. Each share of class A    the capital markets, to remove the potential for compe-
     and class B common stock will automatically convert        tition between Vialta’s expected product line and ESS
     into one share of non-classified Vialta common stock if    customers, and to recruit, retain and incentivize em-
     the IRS rules that the distribution is taxable, if ESS     ployees. Vialta will probably not be attractive. The
     abandons its request for an IRS ruling, or if ESS does     company is the developmental stage – no revenues,
     not receive a ruling from the IRS by June 30, 2002.        negative cash flow, and has a product that the public
                                                                may not accept. Coupling this with Vialta’s trading on
     ESS Technology designs, markets and supports semi-         the OTC Bulletin Board will probably result in Vialta’s
     conductor solutions for multimedia applications in the     not having much upside. Shares of Vialta will probably
     Internet, PC and consumer markets. ESS sells its chips     trade lower after they begin trading. ESS earned $48
     to original equipment manufacturers (OEMs) world-          million for the year ended December 2000. After re-
     wide. ESS has a chip product line that includes video      moving Vialta’s net loss, ESS’s net income would have
     and communications chips used in a variety of con-         been $71 million instead. This would have increased
     sumer electronics applications, including DVD players,     EPS from $1.05 to $1.55.
     CD players, MP3 players, video CD players (VCD
Spin-Off Research                                                                                                13



                            Fresh Spin-Off Situations
                          Millipore to IPO Mykrolis
 Millipore is expected to complete an initial public     drug discovery, biotechnology and pharmaceuticals.
 offering of 7 million shares or 17 percent (19.9% if
 over-allotment exercised) of Mykrolis, on August        Millipore makes products that use separation
 9. The company intends to spin-off the remaining        technology to analyze, identify, and purify fluids.
 shares to Millipore shareholders through a tax-free     Its products include disc and cartridge filters and
 dividend in the first quarter of 2002. The expected     housings, filter-based test kits, precision pumps,
 offering range is between $15.00 and $17.00 per         and ancillary equipment and supplies. The company
 share. Mykrolis will have approximately 40 million      sells its products to the pharmaceutical and
 shares outstanding implying a market capitalization     biotechnology industries for applications that
 of about $640 million. Mykrolis will trade on the       include sterilizing (including virus reduction and
 NYSE under the symbol “MYK”. Millipore will             sterility testing of products such as antibiotics and
 retain 32.5 million shares that would be valued at      protein solutions), cell harvesting, and isolating
 $520 million or $11 per Millipore share if the mid-     compounds from complex mixtures. Millipore’s
 price of the offering range is obtained. Millipore      technology is particularly critical for new life
 has received an IRS ruling that the spin-off of         science research applications within genomics,
 Mykrolis will be tax-free. C. William Zadel,            proteomics and drug discovery, and for the
 Chairman, President and CEO of Millipore will           sterilization and purification of new biotech
 become the CEO of Mykrolis. Francis Lunger,             therapeutics. Millipore’s biosciences is interesting
 currently Chief Operating Officer of Millipore will     because is a large portion of their revenues is
 become the CEO of “New” Millipore.                      generated on what we refer to as the Gillette model.
                                                         Initial hardware sales drive recurring product sales
 BioSciences                                             that produce higher margins than the initial
 Millipore’s technology is used for a range of           hardware.
 applications, from protein sample preparation to
 vaccine sterilization to monoclonal antibody            Millipore’s BioSciences revenue growth rate is
 production. Products include new versions of            forecasted around 12%. Management will target its
 MultiScreen(R) membrane-based multi-well plates         research budget to be about 6-7% of sales.
 for molecular biology applications, and Opticap         Bioscience has gross margins around 52% and
 (TM) cartridges for biotechnology drug                  operating margins of about 18.3%. BioSciences
 manufacturing. Millipore lab water systems are          generated $146 million in EBITDA in 2000 or
 essential to research and analytical laboratory         $3.11 per share and BioSciences expects to
 work. Millipore also offers custom-engineered           generate between $75 and $100 million in free cash
 purification systems that are built and configured to   flow in 2001. Millipore expects to have a tax rate of
 fit within a manufacturing process for                  about 22% in 2001.
 pharmaceuticals and biopharmaceuticals.
                                                         Millipore Second Quarter Results
 Post spin-off, Millipore will focus on serving the      Millipore reported revenues for continuing
 biosciences market from research through                operations (Biosciences) were $168 million
 manufacturing. In 2000, about 63% ($617 million)        compared with $153 million for the same period
 of Millipore’s sales were from the                      last year, a 10 percent growth rate. Excluding the
 Biopharmaceutical & Research business segment.          impact of currency effects, revenue growth was 14
 Millipore is a global supplier of filtration and        percent. The earnings from continuing operations of
 purification systems and technologies used in filter    $0.43 per share compares with $0.41 per share last
 chemicals, water, and biopharmaceutical processes       year that included a gain on the sale of securities.
 for research. Millipore serves the biosciences          Excluding that gain, earnings per share of the
 market within the areas of genomics, proteomics,        continuing operations in the second quarter of 2000
14                                                                                 Spin-Off Research




     would have been $0.32 resulting in a 34 percent         quarter was approximately $24 million or $0.51 per
     growth in earnings per share in the current quarter.    Millipore share. Mykrolis had gross margins around
                                                             50.12% and operating margins of about 12.22%.
     Mykrolis                                                Gross margins are expected to average about 42.5%
     Mykrolis serves the semiconductor industry with         in 2001 with operating margins about 1.7%.
     the technology needed to manufacture                    Obviously the slowdown in capital equipment
     semiconductor devices. This technology controls         spending has effected Mrykrolis’s growth rate for
     the flow, purity, delivery and quality of the           the first half and probably the rest of 2001.
     hundreds of process chemicals and gases used in         However, even with the current environment,
     device manufacturing.         Mykrolis addresses        Mykrolis’s CFO indicated that it will have enough
     applications and opportunities within the               cash on hand to complete 2001-2002 capital
     semiconductor industry, including chemical              expenditure plans even with no pick-up in business
     mechanical planarization (CMP), spin-on                 in that time frame. These projections also do not
     dielectrics, new copper processes, DUV                  include a draw on its $35 million credit facility.
     lithography and the migration to 300mm devices.         That may be slightly optimistic but still signals that
     Mykrolis products are used directly on the different    the company is not bleeding cash. We believe the
     process streams within a fabrication plant, and they    IPO is a way to garner street coverage and
     are also integrated into various OEM equipment          institutional awareness. Mykrolis estimates (per
     systems. Last year, Millipore introduced a major        company guidance) for 2002 are as follows: Gross
     new product for the control of gas flow in              margins between 50-52%, research and
     fabrication plants, the IntelliFlow(TM) Digital         development 6-7% of sales, S G &A 18-20 % of
     mass flow controller. Mass flow controllers are         sales and operating margins around 23-25%.
     used at numerous points within a fabrication plant.     Management also estimates it will save about $12-
     Mykrolis has also expanded its line of                  $15 million in operational expenses by realigning
     QuickChange(R) filters used for chemical                sales offices and closing three of their six
     purification that are packaged and configured to        manufacturing plants to better streamline
     reduce "change-out times" dramatically in a fab.        operations. Management did not provide earnings
     Mykrolis’s patented two-stage filtration and            guidance because of the pending IPO.
     dispense technology is now standard on the
     majority of photolithography tracks.                    Valuation
                                                             Currently, Millipore is trading around $65.50 per
     Mykrolis’s top ten customers accounted for 38% of       shares. Mykrolis’s valuation is about $11 per
     sales in Q1-01 with Tokyo Electron Limited              Millipore share assuming the mid-price of the
     accounting for almost half (17%). Clients of            offering range or $520 million of Millipore’s $3
     Mykrolis also include Applied Materials, ASM            billion market capitalization. Millipore’s stub
     Lithography, Dainippon Screen Manufacturing,            (BioSciences) is valued about $54.50 per share. At
     LAM research, Novellus, SamSung Electronics and         these valuations, BioSciences trades at about 18x’s
     Taiwan Semiconductor. Mykrolis sales also tend to       EV/EBITDA (TTM), 4.2x’s Price to sales (TTM)
     trail equipment makers by about 3 months.               and about 29x’s 2001 EPS estimates.

     Mykrolis accounted for 37% ($355 million) of
     Millipore’s total revenue in 2000, and Mykrolis had
     70% growth Y-o-Y for 2000. Mykrolis has not been
     immune from the current semiconductor slowdown,
     reporting a net operating loss of $6.2 million in the
     second quarter ended June 30. Mykrolis’s net
     income for twelve months trailing through first
Spin-Off Research                                                                                                                                                                                                        15




                                                                               Peer Valuation




                                                                                                                                                                                                          Y
                                                                                                                                                                                    TS




                                                                                                                                                                                                           G
                                                                                      E
                                                                                    ST




                                                                                                                                                                                                        LO
                                                                     RP




                                                                                                                                                                                  EN
                                                                                                                CH
                                                                                  SY




                                                                                                                                                                                                     NO
                                                                   CO




                                                                                                                                                                                UM
                                                                                                                                             p




                                                                                                                                                                                                                     p
                                                                                                              TE
                                                                               BIO




                                                                                                                                          om




                                                                                                                                                                                                                  om
                                                                                                                                                                                                   CH
                                                                                                                              P




                                                                                                                                                                              TR
                                                                RE




                                                                                                                         OR
                                                                                            INC




                                                                                                           T




                                                                                                                                           C




                                                                                                                                                                                                                   C
                                                                                                                                                                                                 TE
                                                                                                                                                                           INC
                                                                                                        EN
                                                                              IED




                                                                                                                                                                           NS
                                                                                                                                                           lis
                                                             IPO




                                                                                                                                        ge




                                                                                                                                                                                                                ge
                                                                                                                          C




                                                                                                                                                        kro
                                                                                          NO




                                                                                                       OG




                                                                                                                                                                                             LIX
                                                                                                                                                                         SI
                                                                                                                                     era




                                                                                                                                                                                                             era
                                                                            PL




                                                                                                                       LL




                                                                                                                                                                        MI
                                                           LL




                                                                                                                                                                      MK
                                                                                                                                                      My
                                                                                      CU




                                                                                                                                                                                           HE
                                                                                                     AP




                                                                                                                     PA
                                                                          AP




                                                                                                                                                                      AT
                                                                                                                                  Av




                                                                                                                                                                                                          Av
                                                         MI
         Company
         Ticker                                       MIL        ABI      CUNO       AOT        PLL     Average                                    MYK      MKSI              ATMI    HELX    Average
         Current Implied Price                     $    54.26 $    26.61 $ 27.20 $     24.16 $    23.76                                          $ 16.00 $ 27.80 $             27.30 $ 26.54
         Shares Out. (000,000)                           47.0      220.5     16.6      106.8      124.7                                              39.5     26.3              30.3     22.8
         Market Cap (000,000)                      $ 2,552.12 $ 5,866.87 $ 452.31 $ 2,580.29 $ 2,963.09                                          $ 632.00 $ 731.03 $          826.92 $ 604.10
         Enterprise Value (000,000)                $ 2,891.05 $ 5,578.20 $ 453.64 $ 3,471.84 $ 3,242.49                                          $ 557.00 $ 633.84 $          740.94 $ 573.01

         EPS
         TTM Estimated / Pro Forma (diluted)       $      1.90 $            0.93 $     1.12 $          0.96 $         1.19                       $    0.61 $ 1.22 $ 0.97 $ 1.32
         TTM P/E                                         28.57             28.61      24.29           25.17          19.97        24.51              26.25   22.79  28.14  20.11                         23.68

         2001E (Diluted)                           $      1.90 $            0.93 $     1.20 $          1.00 $         1.09                                       $     0.15 $ 0.13 $        (0.15)
         Forward P/E                                     28.56             28.61      22.70           24.11          21.84        24.32                              185.33  213.28           -         132.87

         Enterprise
         Enterprise Value / EBITDA                       17.66             16.84      11.89           13.39          11.88        13.50               9.78            7.70     10.81        9.25          9.25
         Enterprise Value / EBIT                         24.42             20.80      15.57           11.52          16.14        16.01              12.63            9.24     13.50        9.96         10.90

         12 Month Trailing
         EBITDA Per Share                                 3.48              1.50       2.29            2.43            2.19                            1.44            3.13     2.26        2.72
         EBITDA Multiple                                 15.59             17.71      11.85            9.95           10.86       12.59               11.10            8.88    12.06        9.75         10.23
         EBITDA Margin                                  30.24%            20.63%     15.56%          30.76%          21.86%                          15.77%          22.12%   21.94%      24.62%        22.89%

         12 Month Trailing
         Trailing Sales                            $     541.5 $ 1,606.1 $ 245.2 $                    843.1 $ 1,248.1                            $ 360.9 $ 372.3 $ 312.5 $ 251.7
         Price to Sales                                   4.71      3.65     1.84                      3.06      2.37              2.73              1.75    1.96    2.65    2.40                         2.34
         Gross Margin                                   55.66%    52.98%   43.40%                    49.00%   53.87%                               50.12%  43.93%  51.81%  46.55%
         Operating Margin                               21.86%    16.69%   11.88%                    23.52%   16.09%                               12.22%  18.43%  17.57%  22.86%

         Book Value                                $      0.91 $            4.57 $        7.78 $       7.33 $         6.14                       $     7.85 $ 13.80 $           9.58 $      4.84
         Price to Book                                   59.77              5.83          3.49         3.29           3.87         4.12                2.04    2.02             2.85        5.49          3.45

         Turnover's
         Account Rec. Turnover                             3.61             4.69          5.24         3.44           4.12                             5.61           8.87      6.71        8.85
         Current Asset Turnover                            4.25             1.57          2.41         2.33           1.70                             2.27           1.24      1.31        2.51
         Working Capital Turnover                        (34.78)            3.41          5.18         2.33           3.45                             3.04           1.59      1.67        3.40

         Returns
         Return on Average Equity                       61.71%            24.83%     15.58%          19.00%          18.28%                           9.48%          13.81%   13.82%      46.04%
         Pre-Tax Average ROA                            22.61%            15.89%     15.42%          11.59%          13.58%                          14.59%          21.46%   18.02%      48.34%
         Return on Average Assets                        7.21%            13.12%      9.88%           8.17%           9.36%                           7.96%          10.89%   10.86%      36.04%
         Return on Capital                              13.03%            22.36%     14.06%          10.21%          12.99%                          12.18%          21.07%   16.22%      56.27%

         Current Ratio                                     0.89             1.85          1.87     #DIV/0!            1.97                             3.92           4.57      4.63        3.82
         Quick Ratio                                       0.56             1.37          1.22     #DIV/0!            1.18                             3.79           3.18      3.43        2.31
         Cash Ratio                                        0.16             0.61          0.29     #DIV/0!            0.30                             1.85           1.92      2.08        1.18
         Cash per share                                    0.48             1.54          0.94         0.14           0.89                             1.90           4.80      3.54        1.37

         Degree of Financing Leverage (EBIT/EBT)          1.91              0.83          1.00         2.05           1.14         1.25                1.00           1.15      1.02        0.91          1.03
         Financing Leverage (Assets/Equity)              10.38              1.71          1.51         1.85           1.95         1.75                1.16           1.21      1.24        1.24          1.23

         Debt to Capital                                 89.44%            4.83%     11.54%         53.64%           33.79%                           0.00%           7.42%    6.79%       0.00%
         Debt to Book Equity                            847.14%            5.08%     13.05%        115.68%           51.02%                           0.00%           8.01%    7.28%       0.00%
         Debt to Enterprise Value                        12.51%            0.92%      3.72%         26.10%           12.05%                           0.00%           4.58%    2.85%       0.00%
         Liabilities to Equity                         1067.18%           70.78%     51.48%         93.56%           94.60%                          16.08%          21.39%   23.58%      23.85%

         Interest Coverage
         Interest Coverage (Earnings)                      2.43           133.82      55.09            4.92          12.00        51.46          #DIV/0!             44.88     73.05     #DIV/0!     #DIV/0!
         EBIT/Interest Expense                             4.57           110.35      53.94            5.91          12.54        45.68          #DIV/0!             50.46     74.19     #DIV/0!     #DIV/0!
         NOTES:
16                                                                                                                                   Spin-Off Research




                                                             Valuation Graphs
                                om
                     Parent andC parables                                                            ff   om
                                                                                               Spin-O andC parables

                                TTMP/EMultiple                                                             TTMP/EMultiple


                                                                               30.00                               28.14
 35.00                                                                                 26.25
             28.57    28.61                                                                         22.79                                 23.68
 30.00                                               25.17            24.51    25.00
                                    24.29                                                                                        20.11
 25.00                                                       19.97             20.00
 20.00
                                                                               15.00
 15.00
                                                                               10.00
 10.00
  5.00                                                                         5.00
   -                                                                               -
              MIL      ABI            N
                                    CU O             AOT     PLL     Average           MYK          MKSI           ATMI          HELX    Average
                                            Ticker                                                                Ticker



                                 EBITD M
                                      A ultiple                                                              ITD ultiple
                                                                                                           EB AM


 20.00                17.71                                                    15.00
             15.59                                                                                                 12.06
                                                                               12.00   11.10
 15.00                                                                                                                           9.75     10.23
                                    11.85                             12.59                          8.88
                                                     9.95    10.86              9.00
 10.00
                                                                                6.00
     5.00                                                                       3.00

         -                                                                         -
              MIL      ABI          CUNO             AOT     PLL     Average            Y
                                                                                       MK           MKSI           ATMI          HELX    Average
                                            Ticker                                                                 Ticker



                      Enterprise Value / EB AM
                                           ITD ultiple                                                                   A ultiple
                                                                                                 Enterprise Value / EBITD M


 20.00       17.66                                                             12.00                               10.81
                      16.84                                                            9.78                                      9.25     9.25
 15.00                                               13.39            13.50     9.00                 7.70
                                    11.89                    11.88
 10.00                                                                          6.00

     5.00                                                                       3.00

         -                                                                         -
              MIL      ABI          CUNO             AOT     PLL     Average           MK
                                                                                        Y           MKSI           ATMI          HELX    Average
                                            Ticker                                                                 Ticker



                              Price to Sales Multiple                                                 Price to Sales Multiple

             4.71                                                              3.00                                2.65
 5.00
                                                                                                                                 2.40     2.34
                      3.65                                                     2.50
 4.00                                                                                               1.96
                                                     3.06                      2.00    1.75
                                                                      2.73
 3.00                                                        2.37
                                    1.84                                       1.50
 2.00
                                                                               1.00
 1.00                                                                          0.50
     -                                                                         -
             MIL      ABI          CUNO              AOT     PLL     Average            Y
                                                                                       MK          MKSI           ATMI          HELX     Average
                                           Ticker                                                                 Ticker
Spin-Off Research                                                                                                                                                  17




                                                                 Operating Graphs
                                        om
                             Parent andC parables                                                            ff   om
                                                                                                       Spin-O andC parables

          60%                                                                          60%

          50%                                                                          50%

          40%                                                                          40%

          30%                                                                          30%

          20%                                                                          20%

          10%                                                                          10%

           0%                                                                          0%
                    MIL            ABI           U
                                                C NO           AOT          PLL                  MYK               MKSI               ATMI              HELX

                                      ross argin O
                                     G M          perating Margin                                                 ross argin O
                                                                                                                 G M          perating Margin


           10                                                                          10
            5                                                                           9
            -                                                                           8
           (5)                                                                          7
          (10)                                                                          6
          (15)                                                                          5
          (20)                                                                          4
          (25)                                                                          3
          (30)                                                                          2
          (35)                                                                          1
          (40)                                                                          -
                    MIL            ABI           U
                                                C NO           AOT          PLL                  MYK               MKSI              ATMI               HELX

                           ec.
                  Account R Turnover Current Asset Turnover WorkingCapital Turnover           Account R Turnover C
                                                                                                       ec.        urrent Asset Turnover Working Capital Turnover


          70%                                                                          60%
          60%                                                                          50%
          50%
                                                                                       40%
          40%
                                                                                       30%
          30%
                                                                                       20%
          20%
          10%                                                                          10%
           0%                                                                          0%
                    MIL            ABI           U
                                                C NO           AOT          PLL                  MYK               MKSI               ATMI              HELX

                            Return onAverage Equity   Pre-Tax Average ROA                              Return on Average Equity   Pre-Tax Average R A
                                                                                                                                                   O
                            Return onAverage Assets Return onCapital                                   Return on Average Assets Return on Capital


          1200%                                                                        30%

          1000%                                                                        25%

           800%                                                                        20%

           600%                                                                        15%

           400%                                                                        10%

           200%                                                                        5%

            0%                                                                         0%
                      MIL           ABI          C NO
                                                  U             AOT         PLL                  MYK               MKSI               ATMI              HELX

           D to Capital D to Book Equity D to Enterprise Value Liabilities to Equity
            ebt          ebt              ebt                                            ebt apital D to Book Equity D to Enterprise Value Liabilities to Equity
                                                                                        D to C       ebt              ebt
18                                                                                         Spin-Off Research




                        Announced Spin-Off Situations
     Allegheny Energy to Carve-Out Allegheny Energy
On July 23, Allegheny Energy (NYSE: AYE)                  Second Quarter Results
announced a two step spin-off of its unregulated power    Allegheny Energy reported a 55 percent increase in
division. The announcement has been expected for          second quarter 2001 earnings per share to a record
several months (May report). Allegheny Energy plans       $1.01, compared to second quarter 2000 earnings per
to carve-out 18% of Allegheny Energy Supply in the        share of $0.65. Net income increased 70 percent in the
fourth quarter of 2001, followed by a tax-free            second quarter of 2001 to $121.3 million, compared to
distribution to Allegheny Energy shareholders in 2002     second quarter 2000 net income of $71.5 million. The
of the remaining 82% stake it owns in the unit. The       second quarter increase in earnings per share mainly
distribution will be contingent on Allegheny Energy       reflects higher net revenue from unregulated operations,
obtaining an IRS tax free ruling.                         primarily related to the energy trading activities of
                                                          Allegheny Energy Global Markets, which was acquired
Allegheny Energy supplies power to Maryland, Ohio,        on March 16, 2001. The Company also attributes the
Pennsylvania, Virginia, and West Virginia. Most of its    increase to the successful expansion of its energy
revenues come from its Allegheny Power unit, which        delivery business through the acquisition of
provides electricity to more than 1.4 million customers   Mountaineer Gas, a natural gas distribution company in
through Monongahela Power, Potomac Edison, West           West Virginia. In addition, the second quarter 2001
Penn Power, and West Virginia Power. Allegheny            earnings per share reflect Allegheny Energy's sale of
Energy’s generating capacity is nearly 10,000 MW          14.26 million shares of common stock on May 2, 2001,
(not including recent assets acquired from Enron), and    which reduced the earnings per share by $.08.
there should be no surprise that 90% of Allegheny’s
plants are coal-fired because of their concentration in   Earnings for the six months ended June 30, 2001, were
the Ohio valley and surrounding areas.                    $221.8 million ($1.93 per share), excluding the first
                                                          quarter after-tax charge of $31.1 million ($.27 per
Allegheny Energy also has a subsidiary Allegheny          share) associated with the cumulative effect of an
Ventures (AV) which it plans to retain post spin-off.     accounting change. Earnings for the six months ended
AV controls Allegheny Energy Solutions, which             June 30, 2000, were $157.9 million ($1.43 per share),
provides energy consulting services to businesses, and    excluding a first quarter extraordinary charge of $70.5
Allegheny Communications Connect (ACC),                   million ($.64 per share). This 35 percent increase in
Allegheny Energy’s telecommunications company.            year-to-date earnings per share is attributed to
ACC is expanding its fiber-optic network in the mid-      unregulated operations reflecting gains from energy
Atlantic region to span 1,600 route miles. The            trading activities and the continued improvement and
company offers voice and data services to AE's energy     expansion of the Company's energy delivery business
customers and is teaming with BroadbandNOW to             through the acquisition of Mountaineer Gas. Allegheny
provide high-speed Internet access.                       Energy is guiding earnings estimates between $3.80 and
                                                          $4.10 for 2001.
Allegheny Energy Supply provides power to
Allegheny Energy and sells electricity to wholesale
and retail customers. Allegheny Energy Supply
recently acquired Merrill Lynch's energy trading
business based in New York, renamed Allegheny
Energy Global Markets.
Spin-Off Research                                                                                                       19




                         Announced Spin-Off Situations
              IMPCO Technology to Spin-Off Quantum
 On June 14, IMPCO (NASDAQ: IMCO) announced                 $15.5 million for the year ending April 2001, an 18.3
 plans to spin off its Quantum subsidiary. IMPCO will       percent increase over fiscal year 2000. Clients include
 focus on the rapidly expanding alternative fuel market     OEMs such as General Motors, Ford, Xcellsis, Ballard,
 after the spin-off. Quantum will continue to focus on      Hyundai, Toyota, Thor, Sunline Transit Yamaha, Opel
 the emerging fuel cell industry. IMPCO expects that        and others. Carmakers such as General Motors, Ford,
 the spin-off will be accomplished by means of a tax-       DaimlerChrysler, and Honda have announced that they
 free distribution of Quantum common stock to IMPCO         intend to offer cars that utilize fuel cell technology in
 stockholders by the end of 2001. The spin-off is           some cases as early as 2003. IMPCO is planning to
 subject to a number of conditions, including the receipt   offer up its expertise in fuel storage and delivery, as
 of opinion that the spin-off will be tax-free. In          well as in electronic control systems, for fuel cell
 addition, General Motors has agreed to purchase 20%        applications.
 of Quantum Technologies from IMPCO prior to the
 spin-off. Terms of the deal were not disclosed. IMPCO
                                                            IMPCO supplies alternative fuel systems technology
 also plans to issue one million shares in a secondary
                                                            and components for internal combustion engines.
 offering prior to the spin-off of Quantum sometime in
                                                            IMPCO products enable these gasoline-powered
 the third quarter. IMPCO indicated that it anticipates
                                                            vehicles to run on cleaner-burning environmentally
 using the proceeds from the offering to fund the
                                                            friendly gaseous natural gas or propane. IMPCO
 operations of Quantum Technologies and for general
                                                            products optimize efficiency and performance while
 corporate purposes, including working capital.
                                                            reducing emission to the lowest-levels. IMPCO is a
                                                            major supplier to original equipment manufacturers and
                                                            the after market in the bus and truck, industrial and
 Fuel cells generate electricity from a chemical reaction
                                                            power generation markets, and to the automotive after
 between hydrogen and oxygen, with water vapor the
                                                            market. IMPCO supports its global after market through
 only tailpipe emission. The downside is hydrogen is
                                                            a network of more than 400 Distributors and 13
 extremely flammable and not available at gas stations.
                                                            company-owned regional offices. Its products include
 Current hydrogen tanks store the volatile gas at 2,500
                                                            fuel control processors, carburetors, converters, and
 to 3,000 pounds per square inch (psi) providing a
                                                            fuel lock-offs. BERU AG, a maker of diesel ignition
 driving range of only 100 to 150 miles vs. gasoline
                                                            systems, owns 12% of IMPCO.
 fueled engines that can travel up to 400 miles between
 fill-ups. Quantum Technologies is developing a
                                                            IMPCO reported a net loss of $13.1 million, or $1.32
 hydrogen tank that can withstand 10,000 psi, enabling
                                                            per share, on revenues of $103.9 million for the fiscal
 a driving range of 300 to more than 500 miles which
                                                            year ending April 30. This compared to net income of
 would could then compete against current gasoline
                                                            $3.1 million, or 33 cents per share, for fiscal year 2000
 engines.
                                                            on revenues of $112.8 million. Research and
                                                            development expenses increased by $17.0 million in
 QUANTUM manufactures hydrogen, compressed                  2001 vs 2000. The decrease in revenues of $8.9 million
 natural gas (CNG) and liquid propane gas (LPG)             for fiscal year 2001 versus fiscal year 2000 was due to
 handling and gaseous fuel storage system technologies      the decrease in our core business and caused by a
 for the use in fuel cell engines and internal combustion   slowing world economy.
 engines. Quantum's product sales reached a record
20                                                                                          Spin-Off Research




                       Announced Spin-Off Situations
              Mercury Air Group to Carveout MercFuel
On May 16, 2001 Mercury Air Group, Inc. (AMEX:            Fagan, president and CEO Joseph Czyzyk, and
MAX) filed a registration statement with the              Frederick Kopkol control about 30% of Mercury Air
Securities and Exchange Commission for the initial        through CFK Partners.
public offering of the common stock of its wholly-
owned subsidiary, MercFuel. MercFuel, hopes to            Mercury Air reported fiscal 2000 (June) sales of
offer 1,380,000 shares of its common stock, including     $338.7 million. The company has 6.43 million shares
180,000 shares which may be purchased by the              outstanding for a market value of $41 million. For the
underwriters to cover over-allotments. MercFuel           nine months ended March the company generated
wishes to price the deal between $9.00 and $11.00         $363 million in revenue and net income of $3.24
per share, wish it hopes to price in September. VMR       million. EBITDA for the period was $18.7 million
Capital Markets, is acting as the underwriter. Post       and EPS was $0.50. After the completion of the spin-
IPO, MercFuel will have 7.98 million shares               off, Mercury Air Group will consist of its higher
outstanding. This implies a market value of $79.8         margin units, Fixed Base operations (FBO), Cargo
million for MercFuel based on the midpoint of the         operations and Government contract services. The
proposed offering range.                                  revenues for the units have grown by 20 to 23%
                                                          annually over the past 3 ½ years. The FBO unit
After the planned IPO, Mercury Air Group will own         operates hangar facilities, refueling operations and
82% (6.55 million shares) of MercFuel, which it           ground support services in 19 locations. The cargo
plans to distribute to shareholders. An IPO priced at     unit is engaged in handling cargo and airmail, and
$10 would raise about $13 million, of which $4.8          provides cargo services such as space logistics and
million would be used to repay intercompany debt to       cargo sales. Through the government contract service,
Mercury Air. If MercFuel successfully sells its           Mercury Air provides refueling services, terminal and
shares at $10, Mercury Air’s remaining interest in        ground handling and weather data service for military
MercFuel would have an implied market value of            bases and government owned or controlled airports.
$65.5 million, exceeding Mercury Air’s entire market
value. The market seems to be suggesting that it is       MercFuel
skeptical that the IPO will price at $10. Based on        MercFuel (AMEX: MK proposed) is an independent
the implied ratio (6.55 m /6.43 m = 1.018), each          provider of fuel sales and services to the aviation
share of Mercury Air Group has $10.18 worth of            industry. MercFuel engages in the contract sale of
MercFuel embedded. This means if the IPO is               aviation fuel, primarily to airlines and airfreight
priced at $10 (as planned), the Mercury Air               companies. It also sells aviation fuel through third
“stub” is currently being valued at a negative            parties to major corporate aircraft operators. Major
$3.70 per share.                                          customers include National Airlines (22% of sales)
                                                          and Tower Air, which have filed for bankruptcy
Mercury Air Group helps keep passenger and cargo          protection, and AirTran Holdings. MercFuel is
airlines in the air. Mercury provides a range of          leveraging its parent's global coverage and market
services to the aviation industry, including fuel sales   position to provide 24-hour coordinated fuel supply
and services (60% of sales, the unit it plans to spin     and delivery worldwide. MercFuel produced $203.4
off) and cargo handling, and it runs about 20 fixed-      million in sales in Fiscal (June) 2000. As a retailer of
base operations (refueling for corporate and private      fuel, the company’s gross margins are inversely
aircraft). It also provides ground support services for   related to price trends. An environment with falling
commercial airlines and the US military and develops      oil prices will tend to expand their margins.
and installs aviation software. Its largest customer is
airfreight firm EVA Airways. Chairman Philip
Spin-Off Research                                                                                                   21




                        Announced Spin-Off Situations
         Thermo Electron to Spin-Off Viasys Healthcare
 In January 2000, Thermo Electron announced              respiratory care, neurocare and medical and surgical
 (NYSE: TMO) that it would create a new company to       products. The company is recognized in the areas of
 provide medical equipment and systems to the            neurodiagnostic instrumentation, lung function testing,
 healthcare industry and spin it off to shareholders.    pediatric ventilation and high frequency oscillating
 Thermo Electron has combined a number of                ventilation. In addition Viasys believes that they have
 businesses that comprise their respiratory care,        the second largest installed base of mechanical
 neurocare, and medical and surgical products, which     ventilators worldwide. Viasys markets their products
 they now call Viasys. Thermo Electron filed a Form      in over 150 countries. Global revenues in fiscal 2000
 10 with the SEC on July 18. We expect the               totaled $345 million. Net income was $18.8 million in
 distribution to take place in September or October of   2000. International revenues account for 35% of total
 this year. Thermo Electron has received a favorable     revenues in fiscal 2000 and 41% of revenues in the
 tax ruling from the IRS. The favorable tax treatment    first fiscal quarter of 2001. Viasys has total sales of
 is subject to Viasys completing a public offering of    $88.4 million in the first quarter of 2001, and net
 10% to 20% of their stock within one year after the     income of $3.87 million.
 distribution date. The company is expected to trade
 on the American Stock Exchange under the symbol         The Respiratory Care Group designs makes and
 “VSS”.       Randy Thurman will act as CEO, and         markets products for the diagnosis and treatment of
 Martin Galvan as CFO.                                   respiratory, circulatory and sleep-related disorders.
                                                         These products are used in a variety of settings, from
 Thermo Electron has been pruning its family tree to     intensive care to home care, but generally share a
 focus on its measurement and detection instruments      focus on breathing and on the adequate availability of
 business. Instruments made by Thermo Electron are       oxygen throughout the body. Viasys offers these
 used in numerous industries, including food and         products under a number of brand names, including
 beverage production, life sciences research, and        Bird Products, Bear Medical Systems, Erich Jaeger
 telecommunications. As part of its reorganization,      and SensorMedics. This business generated $172.5
 Thermo Electron has bought back shares in its           million in sales in 2000, or 50% of total revenues. For
 formerly publicly traded subsidiaries and moved to      the three month period ending March 31, 2001
 sell noncore businesses. Kadant (formerly Thermo        Respiratory Care had sales of $44.7 million. Viasys
 Fibertek-AMEX: KAI), which makes machinery for          estimates that the global demand for respiratory care is
 the paper-recycling and papermaking industries, was     growing at an annual rate of 10%.
 spun off on August 8. Thermo Electron is a
 component of the S&P 500 index. We would point          The Neurocare Group makes and sells two products
 out the both Kadant and Viasys will not be included     lines: a comprehensive line of products for use in the
 in the S&P 500 post spin. Index funds will be           diagnosis and monitoring of nerve, brain, hearing and
 required to sell the shares they receive in the         other disorders. Viasys offers these products under a
 distribution.                                           number of brand names, including Grason-Stadler,
                                                         Nicolet Biomedical and Nicolet Vascular, IMEX and
 Viasys Overview                                         EME. Viasys believes that the Nicolet Biomedical
 Viasys makes and services a variety of medical          subsidiary is the world leader in annual sales of
 devices, instruments and medical and surgical           neurological instrumentation used in neurodiagnostic
 products for use in delivering a range of healthcare    testing and long-term epilepsy monitoring. This
 services.   Viasys focus is on three markets:           business has 2000 sales of $90.9 million, representing
22                                                                                            Spin-Off Research




25% of total sales. Neurcare produced $20.5 million         paid substantial premiums over the fair value of the
in revenues in the first quarter of 2001. The company       net assets of some of the companies that comprise
believes that the neurocare market is growing at an         their business. Thus, Viasys has acquired significant
annual rate of 8%.                                          intangible assets, including about $182 million of cost
                                                            in excess of net assets of acquired companies, or
The Medical and Surgical Group manufactures and             goodwill. This represents about 47% of Viasys total
markets critical care disposable devices, specialty         assets as of March 31, 2001.            Research and
medical products and materials, and a line of wireless      development expenses totaled $18.5 million in fiscal
patient monitoring systems. Their critical care             1999 and $24.8 million in fiscal 2000, and $6.3
disposable products include tube-feeding systems,           million in the first quarter of 2001.
disposable respiratory accessories and surgical
barrier control systems. The company’s specialty            Thermo Electron Corp
products and materials include medical grade                All that remains outstanding from the massive
plastics, called polyurethanes. For example, the            restructuring effort, which began over a year ago, is
company makes specialty-feeding tubes that supply           the spin-off of Viasys. The benefits may start to accrue
nutrition to critically ill patients that runs from the     to shareholders later this year, assuming the stock
nose into the stomach or small bowel. Viasys offer          market is more accommodative. The challenging
their medical and surgical products under brand             macro environment for optical technology and a
names such as Medical Data Electronics, Stackhouse,         decrease in interest income due to lower rates is the
Tecomet, Corpak and Thermedics. This business               main reason for TMO’s recent earnings reduction. We
generated $81.9 million in 2000 sales, or 23% of total      believe the upside in TMO is somewhat limited near-
sales. Medical and Surgical had sales of $23.1              term given its exposure to tech. Thermo looks priced
million in the first quarter of 2001. Viasys estimates      about right. Assuming TMO can trade at 20x the
that the disposables market is growing at a 10%             $0.90 we think they can earn this year, suggests a $18
annual rate.                                                target. Adding back the Kadant spin (worth about $1)
                                                            and value of Viasys (perhaps $2 per TMO share), we
Most of Viasys customers are hospitals. They also           feel Thermo is worth about $21 total.
sell to laboratories, universities, healthcare providers
and public and private research institutions. Sales of      Recent Results
Viasys medical products largely depend on the               TMO announced Q201 cash EPS of $0.23. Organic
reimbursement of patients’ medical expenses by              revenue growth in the quarter was 10%. Life Sciences
government health care programs and private health          organic revenue growth in the quarter was 9%.
insurers. Viasys competes with a number of larger           Optical Technologies organic revenue growth was
better capitalized medical device companies,                20%, and Measurement and Control generated 5%
including Agilent Technologies (which has agreed to         organic revenue growth. On the call, management was
sell its healthcare solutions business to Royal Philips     cautious in outlook due to weakness in its technology
Electronics) and GE Marquette, which have entered           business. TMO’s new guidance of $0.91 - $0.95 is
the market for portable patient monitoring systems.         lower and compares with a consensus of $1.00. The
                                                            company also announced a stock buyback of $100
                                                            million. Overall book to bill for Q201 was 0.96.
A large percentage of Viasys total assets consist of
goodwill from acquired companies. Thermo Electron

Thermo Electron (NYSE: TMO)
Price (8/6/01)        $22.20                      Debt/Total Capital               55%
52 Week Range         $31 - $19.85                ROE                              6%
Shares Outstanding    180 M                       CV Security                      Yes
Market Value          $4 B                        Dividend/Yield                   None
Spin-Off Research                                                                                                        23




                       Fresh Foreign Spin-Off Situation
           Kingfisher to Distribute Woolworths Group
 Kingfisher PLC (Bloomberg: KGF LN), Britain's                largest home improvement retailers and Europe’s third
 third largest retailer, announced that it will spin-off      largest electrical retailing business including Darty,
 its Woolworths Group division on August 28 and               Comet and BUT chains. There has been some
 focus on its more-profitable home-improvement                speculation that Home Depot (NYSE: HD) may have
 business. Shareholders will receive one share of             an interest in Kingfisher post spin-off as Home Depot
 Woolworths group for every one share of Kingfisher.          considers overseas expansion.
 Immediately following the spin-off Kingfisher will
 complete a reverse split, issuing ten shares of              Management shakeup
 Kingfisher for every eleven shares held prior to the         Kingfisher’s Chief Executive Geoffrey Mulcahy is
 distribution. Woolworths Group will have about 1.37          coming under increased pressure to step a side once
 billion shares outstanding after the spin-off and            the spin-off is complete. Several top executives have
 Kingfisher should have about 1.24 billion shares post        recently left and several large institutional holders
 spin-off that includes the effects of the reverse split.     have criticized the performance of the CEO.
 Originally, in the fall of last year Kingfisher              Kingfisher’s stock has fallen over the last two years by
 announced that they would sell or spin-off the unit.         50% from £7.69 in September 1999 to a recent low of
 However, offers for the unit was below Kingfisher’s          £3.86.
 expectations and they chose to spin-off the unit
 instead. In addition to the spin-off of Woolworths           Woolworths Group
 Group, Kingfisher sold its Superdrug unit for £310           Woolworths Group will focus on the retail U.K.
 million and its high street property for £594 million.       market with annual sales in excess of £2.5 billion and
                                                              over 904 stores. They also have developed two new
                                                              formats: Big W and General Store. Big W is a high
 Kingfisher operates more than 1,357 stores in 16             volume superstore and General Store a convenience
 countries. Kingfisher will retain its home-                  drug store format. Both Woolworth’s and Superdrug
 improvement business (do-it-yourself or DIY) as well         have come under increased pressure over the last two
 as its electrical chains after the spin-off. The DIY         years as supermarkets offer more general merchandise
 chain competes against Home Depot Inc. and Lowe's            and drugs. Woolworths also operates entertainment
 Cos. Kingfisher became Europe’s largest home                 businesses EUK, VCI, MVC and Streets Online.
 improvement retailer after the 1998 merger of its            Kingfisher will allocate £200 million in debt to
 B&Q with France's Castorama. Kingfisher controls             Woolworths Group at the time of the spin-off.
 56% of Castorama (Bloomberg “CY FP”, 88.2                    Woolworths Group reported £63 million in EBIT for
 million shares) with a value of Î5.1 billion.                2001.

 Kingfisher reported pro-forma revenues of £5.09
 billion for 2001. Operating profits before one-time
 charges were about £588 million or about £0.43 per
 share. Kingfisher will operate as one of Europe’s

 Kingfisher PLC (London: KGF)
 Price (08/03/01)    £3.85                 EPS 2001                 £0.26, 14.9x
 52 Week Range       £5.50-3.44            EPS 2002                 £0.29, 13.3x
 Shares Outstanding  1.395 B               Price/Sales              0.44 x
 Market Cap          £5.37 B               Dividend / Yield         £0.15 / 0.04%
24                                                                                       Spin-Off Research




                           Fresh Foreign Spin-Off Situation
                   Sulzer Finalizes Spin-Off of Sulzer Medica
     On July 10, Sulzer AG (Bloomberg: SUN VX)                 in the US and the damages from any litigation.
     completed the spin-off of its 74% stake of Sulzer         Currently, the company is facing about 1,000 lawsuits
     Medica (Bloomberg: SMEN SW). Each Sulzer                  and expects the number to increase. The company has
     shareholder received two Sulzer Medica shares per         said its Sfr. 400 million in insurance will not be
     Sulzer share held as of July 9. The spin-off will         sufficient to cover the costs of the recall and its profit
     become a focused medical device company.                  may be hurt. Additionally, about 180 people have had
     Additionally, the float of Sulzer Medica increased        surgery to replace a knee implant that was not as
     from 26% to 100%.                                         widely used as the Inter-Op hip product and will not
                                                               be as costly. Given this, Sulzer Medica will probably
     Sulzer Medica AG is a medical technology company          continue to trade at a discount to its peers.
     serving the orthopedic and cardiovascular markets on
     a global basis. The company designs, manufactures         Sulzer AG manufactures and sells industrial
     and markets orthopedic and cardiovascular products,       equipment, machinery, and medical devices. The
     with a focus on implantable medical products and          company produces pumps, compressors, and
     materials technology. The company’s products              projectile, rapier, airjet, and multiple weaving
     include joint and fracture care, spine care, vascular     machines. Sulzer also develops surface coating
     care, cardiac care, dental care and biologics. The        technologies and provides facilities management
     orthopedics industry had worldwide sales of about         services. The company is in the process of divesting
     $12 billion in 2000 and produces a range of products      non-core businesses. After the Sulzer Medica spin-off,
     to treat injuries or disorders to the skeletal system     Sulzer will focus on its industrial products but will
     and related muscles, joints and ligaments. The four       continue its divestiture strategy. These divestitures
     major segments in the industry include reconstructive     will include Textil (its industrial weaving machines)
     implants, fracture management products, spinal            and Burckhardt (reciprocating compressors). Sulzer
     products, rehabilitation products, and sports             expects more US lawsuits to be filed against it over
     medicine. While the overall industry has grown at         the hip implant recall. So far, as least two lawsuits
     about 7-9% for the last three years, some segments        have been filed. The company is not updating but
     are faster growing than others. In the face of a slower   believes there is only a “minimal risk” that Sulzer will
     growing reconstructive implants segment, companies        be liable for Sulzer Medica. For the year ended
     are expanding their presence in faster growing            December 2000, Sulzer’s pro-forma revenues less the
     segments (spinal implants, trauma, and/or sports          spin-off were Sfr. 4.4 billion, an increase of Sfr. 52
     medicine) or looking to consolidate.                      million (1%) from 1999. Pro-forma net income was
                                                               Sfr. 65 million, an increase of Sfr. 294 million. We
     For the year ended December 2000, the company’s           would expect Sulzer to trade in line with its peers
     sales increased by Sfr. 165 (14%) to Sfr. 1.3 billion.    given the poor state of the economy and the lack of a
     However, net income fell by Sfr. 293 (61%) to Sfr.        catalyst that could warrant the company’s receiving a
     190 million. The company improved its inventory           higher valuation.
     management during the year as the inventory
     processing period fell by over 140 days to 355 days.
     While inventory management has improved, the
     company still has plenty of room for improvement.
     Another issue facing Sulzer Medica is the company’s
     recalling over 2,200 defective Inter-Op hip implants.
     This problem will be two-fold - lower implant sales
Spin-Off Research                                                             25




               Announced Foreign Spin-Off Situations
    Lufthansa Plans to Carve-Out SkyChefs Catering
 On July 23, Deutsche Lufthansa AG (Bloomberg:
 LHA GR) said it plans to sell shares in its catering
 unit LSG Airportgastronomie “Sky Chefs.” Sky
 Chefs operates restaurant facilities at international
 airports as well as in other areas of gastronomy such
 as theatre catering. The company is represented at
 locations such as Frankfurt, Berlin, Turin, Vienna,
 Guam, Saipan and Hong Kong. The company is the
 largest airport caterer in Germany. LSG-
 Airportgastronomie is responsible for all catering in
 Lufthansa's lounges at Frankfurt Airport and handles
 the exclusive catering for Terminal A at Frankfurt
 Airport with ten restaurants and snack bars. In 1998,
 the company assumed responsibility for Lufthansa
 Lounge catering at Munich and Berlin-Tegel
 Airports. At Berlin-Schönefeld, Sky Chefs serves
 lounges for other airlines. At Hong Kong’s Chek Lap
 Kok Airport, the company won half the catering
 space, from a total of over 250 bidding companies.
 Currently, SkyChefs is developing an overall concept
 for catering and retail shops for the international
 airport in Guam, including the architectural planning.

 Deutsche Lufthansa, provides passenger and cargo
 air transportation services worldwide. The company
 offers flight and connection programs in cooperation
 with Star Alliance airline partners from North
 America, Scandanavia, and Asia. Lufthansa has a
 stake in delivery firm DHL. The company also offers
 catering, maintenance, and travel insurance services.
 Lufthansa also runs about 2,200 travel agency centers
 and owns a stake in Amadeus, one of the world's
 largest computerized airline reservation systems.



 Deutsche Lufthansa AG (Bloomberg: LHA GR)
 Price (8/7/01)        E19.01              Debt to Capital    36.99%
 52 Week Range E       27.50 – 17.30       Book / Share       E10.78
 Shares Outstanding    381.6 M             Dividend / Yield   E0.86 / 4.52%
 Market Capitalization E 7.3 B             Return on Equity   17.66%
 TTM Sales / Share     E 32.89 B           FY 2001 EPS        E1.29, 14.8x
26                                                                                            Spin-Off Research




                           Potential Spin-Off Situations
                 Assicurazioni Generali, SpA to Spin-Off
                            Real Estate Assets
On July 10, Italy’s Assicurazioni Generali, SpA             assistance to multinational clients the world over.
(Bloomberg: G IM) stated that it plans to potentially       Besides its corporate and individual clients, Generali
spin-off some of its real estate assets. Generali is then   has been insuring satellite and space missions since
likely to sell shares in the new unit, which would be       1964. Germany has become Generali's largest single
one of the largest property companies in Europe.            market for more than 30% of Generali's premiums,
Generali did not state what percentage of its 22.5          compared to 25% from Italy. In terms of written
trillion lire ($9.8 billion) in real estate assets would    premiums, the Generali Group is the third largest in
go to the new company. Generali is likely to discuss        Europe and ranks among the 20 largest insurers at
the project further at a board meeting scheduled for        world level.
July 28, or in mid-September. The insurer wishes to
improve management of the group’s properties and to         On February 17, 2000, through a cash-and-offer bid,
release funds to develop Generali’s asset                   Generali successfully finalized the acquisition of INA,
management business.                                        one of the largest insurance groups in Italy. After this
                                                            operation the Generali Group has strengthened its
Assicurazioni Generali operates through more than           leadership in the Italian market, and has established
500 companies that provide life, accident, health,          itself as a top player in the European arena, where it
motor, fire, marine/aviation, and other lines of            ranks first in Life and second in Non Life. The Parent
insurance, as well as reinsurance. The company is           Company, Assicurazioni Generali, is one of the
merging redundant operations in individual markets          world's leading reinsurers, just behind the four major
and shedding non-core subsidiaries. It is also rolling      professional operators.
out new life assurance and asset management
products. The Generali Group carries on insurance
operations in some 50 markets over the five
continents, through a network of more than 140 local
units (branches and subsidiary companies) as well as
through a number of specialized offices providing

Assicurazioni Generali (Bloomberg: G IM)
Price (08/07/01)      E36.92                       Debt to Capital         41.06 %
52 Week Range         E43.20 – E32.85              Return on Equity        17.61 %
Shares Outstanding    1.3 B                        Dividend / Yield        E0.26 / 0.7%
Market Cap            E46.3 B                      Book / Share            E7.21
TTM Sales /Share      E40.91                       FY 2001 EPS, P/E        E1.09, 33.7x
Spin-Off Research                                                                   27




                           Potential Spin-Off Situations
    BT Sets up Azure: Telecom Fraud Protection Services
 British Telecommunications Plc is considering a
 spin-off of its internal fraud protection unit into an
 independent company. The new company would have
 annual revenue of approximately 500 million pounds
 ($701 million) and desires to sell fraud protection
 services to rival phone companies. Organized crime
 and billing errors account for about $40 billion each
 year for the telecommunications industry. BT will
 likely keep a stake in the company in order to satisfy
 regulatory requirements. The company has set up a
 division called Azure, headed up by John Bicknell, to
 sell the fraud protection services.


 British Telecommunications Plc is a provider of
 telecommunications services and one of the largest
 private sector companies in Europe. Its key activities
 include local, long distance and international
 telecommunications services, mobile
 communications, Internet services and IT solutions.
 BT serves 28 million exchange lines and more than
 seven million mobile customers in the UK, as well as
 providing network services to other licensed
 operators. Its presence worldwide includes operations
 and joint ventures in countries such as France, Spain,
 Japan, Germany, New Zealand, Japan and Latin
 America. In April 2000, the company announced a re-
 grouping of its activities into new, self-contained
 businesses that will enable greater management
 focus. BT and AT&T have also created Concert, the
 leading global telecommunications company serving
 multinational business customers, international
 carriers and internet service providers worldwide.




 British Telecom ( Bloomberg: BT/A LN )
 Price (08/07/01)      £4.76                     EPS 2002           £0.08, 59.5x
 52 Week Range         £8.19 – 4.03              EPS 2003           £0.13, 36.6x
 Shares Outstanding    8.5 B                     Price/Sales        1.69 x
 Market Cap            £40.6 B                   Dividend / Yield   £0.08 / 0.02%
28                                                                                 Spin-Off Research




                          Potential Spin-Off Situations
                  Enron May Spin-Off Enron Wind Unit
Enron Corp (NYSE: ENE) may spin-off its wind-
power unit Enron Wind as early as this year. Under
the most likely scenario, an investor would take over
the unit then sell shares to the public. Enron Wind
Corp. is an integrated manufacturer and developer of
wind power, providing power plant design and
engineering, project development, and operations and
maintenance services. Enron Wind also designs and
manufactures wind turbines in California and
Germany. Enron is pursuing clean energy solutions in
North America and Europe through Enron Wind
Corp.

Enron Wind is a pioneer and world leader in the
power generation market and a fully integrated wind
power company. Enron Wind designs and
manufactures wind turbines in North America and
Europe, ranging in size from 600 kilowatts to 1.5
megawatts. The company also provides power plant
design and engineering, project development,
financing, and operations and maintenance services.
The company has developed and/or sold more than
4,500 wind turbines worldwide, comprising more
than 1,600 megawatts.

Enron Corp. conducts electricity, natural gas, and
communications businesses. The company produces
electricity and natural gas, develops, constructs, and
operates energy facilities worldwide, and delivers
both physical commodities and financial and risk
management services to customers. The company is
also developing an intelligent network platform to
facilitate online business.




Enron (NYSE: ENE)
Price (08/07/01)        $43.64                  EPS 2001           $1.82, 24x
52 Week Range           $90.75 - $42            EPS 2002           $2.17, 20.1x
Shares Outstanding      746.1 M                 Price/Sales        0.19x
Market Cap              $32.6 B                 Dividend / Yield   $0.50 / 1.15%
Spin-Off Research                                                                                                     29




                           Potential Spin-Off Situations
          Matsushita Electric To Spin-Off IT Service Unit
 On July 14, Matsushita Electric Industrial Co., (a sub     foreign markets on an OEM (original equipment
 of Matsushita Electric Works: Bloomberg: 6991 JP),         manufacturer) basis and marketed under the brand
 is one of the world’s largest makers of consumer           names of third parties. The Company has been
 electronics, stated that it would spin-off its in-house    gradually strengthening overseas sales channels for
 information technology service unit, by the end of         industrial products and components, aside from
 March 2003. The company hopes to give the new              existing consumer products sales networks in many
 company independence in order to boost profits.            countries and regions. The Company also
 Matsushita is in separate discussions with its labor       implemented supply chain management (SCM),
 union to introduce an early retirement program in          working with several overseas mass-scale retailers to
 September. The company is planning to increase the         raise global operational efficiency.
 staff of the IT unit to roughly 2000 from its current
 staff of 250, during the next 20 months. The move is       Matsushita Electric Works manufactures within
 part of Matsushita group’s restructuring business          three main segments: Consumer products is
 over the next three years. The spun-off company            Matsushita's traditional business area. Sales in this
 would provide IT support services for small to             category, consisting of video and audio equipment and
 midsize companies, including dispatching instructors       home appliances and household equipment, totaled
 for personal computer classes; managing paperwork          3,012 billion yen, and represented 41% of total
 for employee medical checkups; household moves             Company sales, in fiscal 2000. Industrial products
 and overseas transfers; and managing office                are comprised of information and communications
 buildings.                                                 equipment and industrial equipment. This has been the
                                                            Company's fastest growth category in the last decade,
 Matsushita Electric Industrial Co., Ltd., is a producer    led by mobile communications equipment and
 of electronics and electric products. Matsushita           personal computer (PC)-related equipment. However,
 currently offers a comprehensive range of products,        in the last two years growth has slowed due mainly to
 systems and components for consumer, business and          the significant worldwide price declines in PC
 industrial use. Most of the Company's products are         peripherals. Sales in fiscal 2000 totaled 2,757 billion
 marketed under Panasonic, National and Technics            yen for this category, representing 38% of total
 brand names, with some of its subsidiaries using           Company sales. Matsushita produces a wide range of
 brand names such as Quasar, Victor and JVC.                electronic and electric components and devices.
 Matsushita operates 222 companies in 44 countries          Major products included in this category are
 outside of Japan, including five regional                  semiconductors, general electronic components,
 headquarters, 43 manufacturing/sales companies, 98         display devices, electric motors, compressors and
 manufacturing companies, 46 sales companies, 12            batteries, to support the Company's finished products
 research organizations and five finance subsidiaries.      and for sale to other manufacturers. Sales of
 International marketing of Matsushita's products is        components as a whole in fiscal 2000, excluding in-
 conducted through the Company's sales subsidiaries         house consumption, totaled 1,530 billion yen,
 and affiliates, and also through independent               accounting for 21% of the Company's overall sales.
 distributors. In addition, certain products are sold in

 Matsushita Electric ( Bloomberg: 6991 JP )
 Price (08/07/01)     ¥1,273                               EPS 2001                ¥36.53, 34.8x
 52 Week Range        ¥1,569 – 1,157                       EPS 2002                ¥39.20, 32.50x
 Shares Outstanding    715.3 M                             Price/Sales             0.95x
 Market Cap           ¥910.6 B                             Dividend / Yield        ¥12.50 / 0.98%
30                                                                                       Spin-Off Research




                                Potential Spin-Off Situations
                Palm Considers Spin-Off of Operating Unit
     Palm (NASDAQ: PALM) mentioned on July 13 that              speculation that it could become an acquisition target.
     it is considering a break-up into two companies to         Management tried to quell the rumors, telling
     separate its software licensing operations from the        conference attendees that any interested acquirers had
     manufacturing and distribution of its handheld             not approached them. Management added that the
     devices. Such a move could help to ease concerns           company was on track to return to profitability after it
     about the company following the disastrous launch of       had cleared its inventory build-up and was in no
     its latest models. Palm warned last month that             danger of running out of cash.
     delayed shipments of two new personal digital
     assistant lines would leave it with revenues of only
                                                                Santa Clara, California-based Palm has sold more
     around half of its previous estimate, while it will also
                                                                than 7 million of its Palm and older PalmPilot models.
     have to write off $300m of inventory. Management
                                                                Dedicated devotees support a mini-industry of related
     stated that they had been studying the best way to
                                                                books, software, and Web sites. Its Palm line sports
     split Palm in two for the past year. A split into
                                                                address book, e-mail, and memo functions, and
     separate software licensing and hardware companies
                                                                features such as color displays and wireless Internet
     would echo a similar move by Qualcomm, which
                                                                access. Palm commands about 65% of the market for
     holds the patent on CDMA wireless technology.
                                                                handhelds. As in the PC market, the battle between
     Qualcomm sold its handset manufacturing business
                                                                handheld computer makers has centered on disparate
     last year. The move would help Palm capitalize on its
                                                                operating systems (OS); it also features a familiar
     dominant position in the handheld software market,
                                                                combatant: Microsoft. While devices from Casio,
     without the distraction of its recent hardware
                                                                Compaq, and Hewlett-Packard that run the OS
     blunders.
                                                                veteran's Windows software may pose the greatest
                                                                threat to Palm's dominance, it's the showdown with
     Palm, Inc. currently only gets a small part of its sales
                                                                partner-rival Handspring that has taken the biggest bite
     from licensing its operating system to Handspring,
                                                                out of its market share. Palm founders Jeff Hawkins
     Sony and other device makers. In the past it has said
                                                                and Donna Dubinsky also founded Handspring. The
     the unit could eventually account for about 40 per
                                                                two jumped ship following 3Com's buyout of Palm
     cent of sales. A division would also resolve conflict
                                                                parent U.S. Robotics. Handspring's Visor handhelds
     of interests in the company, which licenses software
                                                                (which run the Palm OS) initially offered features that
     to its own competitors in the hardware field. Sales of
                                                                clearly differentiated it from Palm products - colorful
     Palm's handhelds hit a wall in March - a dramatic
                                                                plastic housings, lower prices, expansion bays for add-
     reversal from the double-digit revenue growth that it
                                                                on modules. However recent Palm releases have seen
     enjoyed following its spin off from 3Com just last
                                                                the market leader playing catch-up. Palm's entry-level
     year. The company blamed the US economic
                                                                m100 matches the prices of Handspring's base model,
     slowdown. Palm also faced criticism for a string of
                                                                and Palm now offers colorful faceplates for the device.
     management miscues, including the delayed launch
                                                                Palm also plans to release devices with greater
     of its flagship M500 and M505 lines and the
                                                                expansion capabilities.
     cancellation of its planned acquisition of Extended
     Systems, a maker of wireless corporate software for
     PDAs. Earlier this year it cut 300 jobs and warned it
     was considering further reductions to its workforce.
     The plummeting value in Palm's share price sparked
Spin-Off Research                                                                      31




                      Potential Spin-Off Watch List
                                                                          Report
 Parent                      Symbol    Potential Spin-Off                  Date
 3COM                        COMS      CommWorks                             Feb-01
 Allegheny Energy            AYE       Unregulated Power Unit               May-01
 American Electric Power     AEP       Unregulated Power Unit               May-01
 Ambassadors International   AMIE      Education Group                      May-01
 Arel Communications         ARLC      ArelNet                              May-00
 Assicurazion Generali       G IM      Real Estate                        August-01
 Boeing                      BA        Satellite Business                    Dec-00
 Bright Station              BSTN      4 units                              June-00
 British Telecom             BTY       Azure                              August-01
 Canary Wharf Group          CWG LN    Canary Wharf II                      April-01
 CSFBDirect                  DIR       DLJDirect Japan                        Jan-01
 Computer Associates         CA        Break-up                              July-01
 Delphi Automotive           DPH       High Tech supplier business          April-00
 Degussa                     DGX GR    Dental Unit                          June-00
 Elcor                       ELK       Cybershield                          April-00
 Enron                       ENE       Wind Unit                          August-01
 Halliburton                 HAL       Engineering and Construction           Jan-01
 Hilton Group Plc.           HLTGY     Betting and Gambling Business         Mar-00
 Invensys Plc.               ISYS LN   Power Systems                    November-00
 ION Beam                    IBAB      Food Safety Unit                     June-01
 Kvaerner ASA                KVI NO    Oil & Gas                             Feb-01
 Matsushita Electric         6991 JP   Information Technology             August-01
 Novell                      NOVL      Internet Content Division            Sept-00
 Omnicom Group               OMC       Career Mosaic                          Jan-00
 Pall Corporation            PLL       Life Sciences Group                  June-01
 Palm                        PALM      Operating Software                 August-01
 Progress Energy             PGN       Interpath Communications             May-00
 Reuters Group Plc.          RTRSY     Web Security Financial Network        Mar-00
 Reynolds and Reynolds       REY       Document Services                    May-00
 Rohm & Haas                 ROH       CMP Slurry Division                 March-01
 Qwest Communications        Q         CyberSolutions                     August-00
 Targeted Genetics           TGEN      Cell Therapy Division                Sept-00
 Techtronic Ltd.             TTNDY     Vacuum Cleaner Unit                  May-01
 Telenor ASA                 TELN      Directory Services                    Feb-01
 United Technologies         UTX       Fuel Cell Division                   April-00
 U.S. Plastics Lumber        USPL      Environmental Services Unit            Jan-00
 Volt Information Sciences   VOL       Break-Up                              Feb-01
 Westell Technologies        WSTL      Conference Plus                        Jan-00
 WorkFlow Management         WORK      iGetSmart                            June-00
32                                                                                                        Spin-Off Research




                                                   Insider Transactions
      Company                                                     Rel      # of        Trans        Trans         Trans
       Name              Ticker               Insider Name                Shares       Type         Date(s)      Price(s)
Apollo Group, Inc.      APOL      SPERLING, PETER V.                -       500,000     144          7/5/01      $21.75
AT&T Corp.              T         MALONE, JOHN C. CRUT            DIR       721,564     144         7/10/01      $14.71
Cabletron Systems       CS        MYEROW, JANE                      -         2,050     144         7/13/01       $0.05
Cabletron Systems       CS        JAEGER, ERIC                    OFF         3,375     144          7/3/01       $0.08
Cabletron Systems       CS        MYEROW, MICHAEL D.              DIR        25,000     144          7/2/01       $0.55
EMC                     EMC       RUETTGERS, MICHAEL C.            CB       200,000      JS         6/13/01         -
Enron Corp.             ENE       LAY, KENNETH L.                  CB       224,000     144         7/31/01      $14.05
Ford Motor Company      F         O'CONNOR, JAMES G.              OFF        25,000     144          7/9/01         -
Ford Motor Company      F         FORD, EDSEL B. II               DIR         2,778     144          7/3/01       $0.07
HNC Software Inc.       HNCS      CANTY, JAMES KELL               EMP         6,000     144         7/20/01       $0.14
Lucent Technologies     LU        MORGAN STANLEY                    -         8,250     144         7/11/01       $0.05
Millipore               MIL       KATHLEEN ALLEN                    -         1,780     144        08/02/01      $62.97
Millipore               MIL       ROBERT E. CALDWELL                -         8,500     144        08/01/01      $63.33
Millipore               MIL       KATHLEEN STEARNS                  -         2,142     144        07/31/01      $63.27
Millipore               MIL       THOMAS O. PYLE                    -         1,500     144        07/31/01      $63.26
Moody's Corporation     MCO       BACHUS, DANIEL E.                CT         2,000     144         7/10/01       $0.11
Moody's Corporation     MCO       NELSON, TODD S.                   -        50,000     144          7/9/01       $2.66
Motorola, Inc.          MOT       CROSBIE, DONALD B.                -         4,000     144         7/12/01       $0.07
QUALCOMM Inc.           QCOM      POIZNER FMLY FNDTN C/O S&C        -           800     144         7/19/01       $0.05
QUALCOMM Inc.           QCOM      KINGSLAND, SAMUEL D.              -         2,034     144         7/13/01       $0.13
QUALCOMM Inc.           QCOM      SPURLOCK, STEVEN M.               -           397     144         7/13/01       $0.03
QUALCOMM Inc.           QCOM      BELL, WALTER T.                   -        10,000     144         7/12/01       $0.53
QUALCOMM Inc.           QCOM      AISYS CORPORTAION                 -         1,210     144          7/3/01       $0.07
Quanta Services, Inc.   PWR       SEAWARD, DANIEL O. JR.           PR         3,860     144         7/13/01         -
Quanta Services, Inc.   PWR       BROOKS, TERESA LYNN               -         1,105     144         7/11/01         -
Titan Corporation       TTN       VIRTUAL CAPITAL OF CA             -        25,000     144          7/9/01       $0.51
VelocityHSI             VHSI      BORSARI INT TR84-W&G TTEES        -        19,051     144          7/5/01       $0.00




B=Buy                                S=Sell                    B/O=Owner of >10%      JB=Non-Open market Buy
B*=Option Related                    144=Intent to Sell        3=Form 3               JS=Non-Open Market Sale
Spin-Off Research                                                                                         33




                                   Analyst Coverage

                                   Spin-Off                                                           Research
               Company    Symbol    Date                   Analyst           Recommendation             Date
  3Com                    COMS       3/2/00   G erard Klauer Mattison       neutral                    06/28/01
                                              Merrill Lynch                 near-term neutral          06/27/01
                                              Morgan Stanley Dean W itter   neutral                    06/27/01
                                              Merrill Lynch                 near-term neutral          06/27/01
                                              Sanford C. Bernstein          outperform                 04/26/01
                                              A.G . Edwards & Sons          m aintain position         04/16/01
  Actuant                 ATU        3/2/00   ABN Am ro                     add                        07/05/01
                                              Credit Suisse First Boston    hold                       06/25/01
                                              G oldm an, Sachs & Co.        m arket perform            06/21/01
                                              First Uniion Securities       m arket perform            05/22/01
  ACX Technologies        ACX                 Deutsche Banc Alex Brown      m arket perform            05/16/01
  Adaptec Inc             ADPT                Hornblower Fischer AG         trading buy                 5/15/01
                                              B. Riley & Com pany, Inc      strong buy                 05/11/01
                          ADPT                Hornblower Fischer AG         trading buy                05/15/01
                                              B. Riley & Com pany, Inc      strong buy                 05/11/01
  Agilent                 A          6/2/00   SG Cowen                      buy                        06/28/01
                                              Salom on Sm ith Barney        outperform                 06/25/01
                                              Thom as W eisel Partners      m arket perform             6/22/01
                                              Credit Suisse First Boston    hold                       06/21/01
  Alcatel SA              ALA                 J.P. Morgan                   m arket perform            07/11/01
                                              W G Z-Bank                    short term underperform    07/10/01
                                              KBC Securities France         reduce                     07/10/01
                                              SEB AG                        buy                        07/10/01
                                              CIC-EIFB                      buy                        07/10/01
  Am erica Online         AOL                 ABN Am ro                     add                        07/09/01
                                              Morgan Stanley Dean W itter   strong buy                 07/05/01
                                              Barrington Research Assoc.    strong buy                 07/05/01
                                              W it SoundView                strong buy                 07/03/01
                                              First Uniion Securities       strong buy                 07/02/01
                                              SG Cowen                      strong buy                 07/02/01
                                              Thom as W eisel Partners      buy                        07/02/01
                                              Merrill Lynch                 near-term buy              06/28/01
                                              Salom on Sm ith Barney        buy                         6/28/01
  Am erica Online Latin   AOLA       8/7/00   Bear, Stearns & Co            neutral                    06/26/01
                                              Salom on Sm ith Barney        buy                        05/17/01
                                              Credit Suisse First Boston    buy                        05/04/01
                                              UBS W arburg                  buy                        04/10/01
  AMR Corp                AMR                 ABN Am ro                     hold                       07/11/01
                                              Merrill Lynch                 near-term accum ulate      07/09/01
                                              Deutsche Banc Alex Brown      buy                        07/06/01
                                              The Buckingham Research       accum ulate                07/05/01
                                              Salom on Sm ith Barney        neutral                    06/29/01
                                              UBS W arburg                  buy                        06/28/01
  ANC Rental Corp         ANCX      6/30/00   Salom on Sm ith Barney        outperform                 05/10/01
  AON Corp                AOC                 Friedm an, Billings, Ram      buy                        07/05/01
                                              Morgan Stanley Dean W itter   outperform                 06/28/01
                                              Prudential Securities         hold                       06/15/01
                                              G oldm an Sachs & Co.         m arket perform            06/11/01
                                              Dresdner Kleinwort Bens       hold                       05/07/01
  Apollo G roup           APO L               Barrington Research Assoc.    long-term buy              07/03/01
                                              Thom as W eisel Partners      buy                        07/02/01
  APW Ltd.                APW       7/31/00   Salom on Sm ith Barney        buy                        06/22/01
                                              G oldm an, Sachs & Co.        m arket perform            06/22/01
                                              Needham & Co                  buy                        06/22/01
                                              Robertson Stephens            m arket perform            06/22/01
                                              Thom as W eisel Partners      buy                        06/22/01
                                              Robert W . Baird & Co.        m arket perform            06/06/01
                                              Salom on Sm ith Barney        buy                        03/26/01
                                              Banc of Am erica Securities   m arket perform            03/22/01
                                              Morgan Stanley Dean W itter   neutral                    03/21/01
  Arch Coal               ACI       3/27/00   Salom on Sm ith Barney        outperform                 07/11/01
                                              Merrill Lynch                 near-term buy              06/26/01
                                              Lehm an Brothers              strong buy                 06/25/01
                                              Bear, Stearns & Co            buy                        06/20/01
34                                                                                Spin-Off Research




                                     Analyst Coverage

                                     Spin-Off                                                         Research
               Company      Symbol    Date                   Analyst           Recommendation           Date
 Ashland Inc                ASH                 UBS W arburg                  buy                      07/05/01
                                                Morgan Stanley Dean W itter   outperform               06/27/01
                                                Bear, Stearns & Co            attractive               06/20/01
                                                Merrill Lynch                 near-term accum ulate    06/19/01
                                                Credit Suisse First Boston    hold                     05/02/01
 Asia Global Crossing Ltd   AX        10/6/00   Deutsche Banc Alex Brown      buy                      06/29/01
                                                Deutsche Banc Alex Brown      buy                      06/29/01
                                                Goldman, Sachs & Co           recomm end list          06/11/01
                                                Merrill Lynch                 near-tern buy            05/16/01
                                                Lehm an Brothers              strong buy               05/03/01
                                                CIBC W orld Markets           buy                      04/24/01
                                                Salomon Sm ith Barney         buy                      11/13/00
 AT&T                       T                   Prudential Securities         hold                     07/11/01
                                                ABN Am ro                     hold                     07/10/01
                                                Dresdner Kleinwort Bens       buy                      07/10/01
                                                UBS W arburg                  buy                      07/10/01
                                                Thom as W eisel Partners      m arket perform          07/09/01
 AT&T W ireless             AW E       7/9/01   Morgan Stanley Dean W itter   outperform               07/10/01
                                                Banc of Am erica Securities   buy                      07/10/01
                                                Robinson-Humphrey Co.         outperform               07/09/01
                                                Tucker Anthony Sutro Ca       strong buy               07/09/01
                                                Blaylock & Partners           hold                     06/28/01
 AutoNation                 AN        6/30/00   Robertson Stephens            buy                      05/21/01
                                                Lehm an Brothers              strong buy               05/03/01
                                                Bear, Stearns & Co            attractive               05/03/01
                                                Morgan Stanley Dean W itter   neutral                  04/09/01
 Avaya                      AV        10/2/00   CIBC W orld Markets           buy                      06/15/01
                                                Morgan Stanley Dean W itter   outperform               06/14/01
                                                Dresdner Kleinwort Bens       buy                      06/13/01
                                                Hornblower Fischer AG         trading buy              02/21/01
                                                Merrill Lynch                 near-term accum ulate    04/26/01
 Axcelis Technologies       ACLS      7/10/00   Lehm an Brothers              buy                      07/09/01
                                                Goldman Sachs & Co.           recomm end list          06/26/01
 Banyan                     BNYN                H.C. W ainwright              buy                      07/10/01
 Baxter Int.                BAX                 Deutsche Banc Alex Brown      buy                      07/10/01
                                                Lehm an Brothers              strong buy               07/09/01
                                                ABN Am ro                     add                      06/29/01
                                                Merrill Lynch                 near-term buy            06/20/01
                                                Goldman Sachs & Co.           m arket outperform       06/11/01
 BCE                        BCE                 Goldman Sachs & Co.           recomm end list          07/11/01
                                                Yorkton Securities            hold                     06/29/01
                                                Scotia Capital                strong buy               06/20/01
                                                UBS Bunting W arburg Inc.     strong buy               06/18/01
                                                National Bank Financial       buy                      06/11/01
 Bristol-Myers Squibb       BMY                 ABN Am ro                     buy                      07/10/01
                                                Lehm an Brothers              buy                      07/09/01
                                                Bank Julius Baer & Co.        reduce                   07/06/01
                                                Deutsche Banc Alex Brown      strong buy               07/06/01
                                                Merrill Lynch                 near-term buy            06/28/01
 Cabot Corp                 CBT                 J.P. Morgan                   buy                      07/02/01
                                                Goldman Sachs & Co.           recomm end list          06/14/01
                                                Merrill Lynch                 near-term accum ulate    05/16/01
                                                CIBC W orld Markets           strong buy               06/01/01
 Cabot Micro-Electronics    CCMP      9/29/00   Salomon Sm ith Barney         buy                      06/20/01
                                                Merrill Lynch                 long-term buy            06/19/01
                                                Goldman Sachs & Co.           m arket outperform       06/13/01
                                                Robertson Stephens            buy                      05/21/01
 Cendant Corporation        CD                  Jolson Merchant Partner       strong buy               07/10/01
                                                Goldman Sachs & Co.           recomm end list          07/05/01
                                                Lehm an Brothers              strong buy               07/05/01
                                                Credit Suisse First Boston    strong buy               07/03/01
                                                Morgan Stanley Dean W itter   outperform               07/03/01
Spin-Off Research                                                                                          35




                                      Analyst Coverage

                                      Spin-Off                                                         Research
               Company       Symbol    Date                   Analyst            Recommendation          Date
  Coach Inc.                 COH       10/5/00    Goldman Sachs & Co.           recommend list          07/09/01
                                                  Prudential Securities         buy                     06/29/01
                                                  The Buckingham Research       strong buy              06/19/01
                                                  Bear, Stearns & Co            attractive              06/13/01
                                                  UBS Warburg                   buy                     05/22/01
  Computer Associates        CA                   Prudential Securities         buy                     07/10/01
                                                  ABN Amro                      hold                    07/10/01
                                                  SG Cowen                      strong buy              07/10/01
                                                  Merrill Lynch                 near-term neutral       06/21/01
                                                  First Albany Corp.            buy                     06/21/01
  Comverse Technology        CMVT                 Morgan Stanley Dean Witter    neutral                 07/11/01
                                                  CIBC World Markets            hold                    07/11/01
                                                  U.S. Bancorp Piper Jaffray    buy                     07/11/01
  Coorstek                   CRTK       1/4/99    Wells Fargo Van Kasper        buy                     06/27/01
                                                  CE Unterburg Towbin           buy                     06/27/01
                                                  Dresdner Kleinwort Bens       hold                    06/27/01
                                                  Robertson Stephens            buy                     06/27/01
  Corel Corporation          CORL                 Octagon Capital Corporation   hold                    07/09/01
                                                  BMO Nesbitt Burns             market perform          06/28/01
  Daisytek International     DZTK                 J.P. Morgan                   long-term buy           04/04/01
                                                  Williiam Blair & Co.          long-term buy           03/05/01
  Delta Woodside             DLW                  Wachovia Securities           neutral                 02/28/01
  Deluxe Corp                DLX                  Miller Johnson Steichen       buy                     06/13/01
                                                  Lehman Brothers               buy                     06/12/01
  Diageo Plc                 DEO                  ABN Amro                      add                     07/09/01
                                                  Natexis Capital               over weight             07/03/01
                                                  Merrill Lynch                 near-term accumulate    07/02/01
                                                  Deutsche Banc Alex Brown      buy                     06/29/01
  Dun & Bradstreet           DNB                  Goldman Sachs & Co.           market perform          07/09/01
                                                  Stephens Inc.                 outperform              07/02/01
  Eastman Chemical Company   EMN                  Deutsche Banc Alex Brown      buy                     07/02/01
                                                  Merrill Lynch                 near-term buy           07/02/01
                                                  Goldman Sachs & Co.           market perform          06/11/01
                                                  Morgan Stanley Dean Witter    outperform              06/08/01
                                                  Salomon Smith Barney          buy                     05/21/01
  Eaton                      ETN                  Dresdner Kleinwort Bens       buy                     07/05/01
                                                  Prudential Securities         hold                    06/28/01
                                                  Lehman Brothers               strong buy              06/28/01
                                                  McDonald Investments          buy                     06/27/01
  ECI Telecom                ECIL                 Goldman Sachs & Co.           market outperform       06/11/01
                                                  Bank Investec Clali Ltd.      accumulate              06/07/01
                                                  Oscar Gruss & Son Inc         hold                    05/29/01
                                                  UBS Warburg                   hold                    05/24/01
                                                  Schroder Salomon Smith        neutral                 05/24/01
  Edwards Lifesciences       EW         4/3/00    Goldman Sachs & Co.           market outperform       06/11/01
                                                  Bank Investec Clali Ltd.      accumulate              06/07/01
                                                  Oscar Gruss & Son Inc         hold                    05/29/01
                                                  UBS Warburg                   hold                    05/24/01
  eFunds Corp                EFDS      12/29/00   Jefferies & Co.               buy                     07/11/01
                                                  Lehman Brothers               strong buy              06/27/01
                                                  Miller Johnson Steichen       buy                     06/19/01
                                                  Robinson-Humphrey Co          outperform              05/04/01
  eLoyalty                   ELOY      2/16/00    Deutsche Banc Alex Brown      buy                     07/02/01
                                                  Adams, Harkness & Hill        market perform          06/11/01
                                                  Credit Suisse First Boston    buy                     06/11/01
                                                  First Union Securities        buy                     06/11/01
                                                  SG Cowen                      buy                     05/14/01
36                                                                                       Spin-Off Research




                                          Analyst Coverage

                                          Spin-Off                                                           Research
               Company           Symbol    Date                    Analyst            Recommendation           Date
 E MC                            E MC                P acific G rowth E quities      strong buy               07/11/01
                                                     First Albany Corp.              buy                      07/10/01
                                                     P erform axx A G                neutral                  07/09/01
                                                     N eedham & Co                   buy                      07/09/01
                                                     W ells Fargo Van Kasper         buy                      07/09/01
                                                     B ear, S tearns & Co            buy                      07/09/01
                                                     S alom on Sm ith Barney         outperform               07/06/01
 E nergizer H oldings            E NR       4/3/00   P rudential S ecurities         hold                     06/15/01
                                                     G oldm an S achs & C o.         m arket perform          06/11/01
                                                     Friedm an, B illings, R am      accum ulate              06/01/01
 E nron                          E NE                J.P. Morgan                     buy                      07/10/01
                                                     S anders Morris Harris          hold                     06/27/01
                                                     M errill Lynch                  near-term buy            06/27/01
                                                     P rudential S ecurities         buy                      06/26/01
                                                     A .G . Edwards & Sons Inc.      accum ulate              06/22/01
 Florida E ast Coast Inds        FLA       10/9/00   C redit S uisse First B oston   buy                      03/26/01
 FMC Corp.                       FMC                 S alom on Sm ith Barney         buy                      05/10/01
                                                     B erenberg B ank                hold                     05/03/01
                                                     M idwest Reearch                neutral                  04/18/01
 Ford                            F                   B anc of Am erica               m arket perform          07/11/01
                                                     S alom on Sm ith Barney         buy                      07/10/01
                                                     G oldm an S achs & C o.         m arket perform          07/05/01
                                                     Lehm an Brothers                buy                      07/03/01
                                                     J.P. Morgan                     hold                     06/29/01
 G entiva Health S ervices       G TIV     3/16/00   A valon R esearch G roup        buy                      05/07/01
 G enuity                        G EN U    6/28/00   G erard K lauer M attison       neutral                  06/28/01
                                                     K aufm an Bros.                 accum ulate              06/26/01
                                                     S alom on Sm ith Barney         buy                      06/13/01
                                                     Lehm an Brothers                m arket perform          06/04/01
                                                     M organ Stanley Dean W itter    outperform               06/01/01
                                                     M errill Lynch                  near-term accum ulate    06/01/01
 G lobal C rossing               GX                  G oldm an S achs & C o.         recom m end list         07/11/01
                                                     U .S . Bancorp P iper Jaffray   buy                      07/10/01
                                                     M errill Lynch                  near-term buy            07/10/01
                                                     Lehm an Brothers                buy                      07/02/01
                                                     D eutsche B anc A lex Brown     strong buy               06/29/01
                                                     J.P. Morgan                     buy                      06/29/01
                                                     K aufm an Bros.                 buy                      06/28/01
 G lobal P aym ents              G PN      1/31/00   Lehm an Brothers                buy                      06/28/01
                                                     Jefferies & C o.                accum ulate              06/28/01
 G rant P rideco D rilling       G RP      4/14/00   D eutsche B anc A lex Brown     strong buy               07/09/01
                                                     S anders Morris Harris          underperform             07/06/01
                                                     P rudential S ecurities         buy                      07/03/01
                                                     A BN Am ro                      add                      07/02/01
 G reat Lakes Chem ical          G LK                A BN Am ro                      hold                     07/05/01
                                                     J.P. Moragn                     m arket perform          07/02/01
                                                     G oldm an S achs & C o.         m arket perform          06/28/01
                                                     M cD onald Investm ents         hold                     06/26/01
                                                     M errill Lynch                  near-term neutral        06/21/01
 H ewlett-Packard                HW P                M organ Stanley Dean W itter    neutral                  07/11/01
                                                     U BS W arburg                   buy                      07/11/01
                                                     The Buckingham R esearch        strong buy               07/09/01
                                                     S alom on Sm ith Barney         neutral                  07/09/01
                                                     S G C owen                      buy                      06/28/01
 H NC Software                   H NC S              U .S . Bancorp P iper Jaffray   strong buy               07/09/01
                                                     C redit S uisse First B oston   buy                      06/15/01
                                                     Jefferies & C o.                buy                      05/25/01
                                                     S tephens Inc.                  buy                      04/19/01
 H otel R eservations N etwork   ROOM      2/25/00   H oak B reedlove W esneski      buy                      06/29/01
                                                     Lazard Freres & Co              outperform               06/28/01
                                                     P acific C rest Securities      strong buy               06/15/01
                                                     C IB C W orld Markets           buy                      04/24/01
 iG ate                          IG TE               A dam s, Harkness & Hill        m arket perform          05/30/01
                                                     P arker H unter Incorporated    accum ulate              05/23/01
                                                     Janney Montgom ery Scott        accum ulate              05/11/01
                                                     C L K iing & A ssociates        strong buy               05/11/01
Spin-Off Research                                                                                                        37




                                                Analyst Coverage

                                                Spin-Off                                                             Research
                 Company               Symbol    Date                     Analyst             Recommendation           Date
  IM S H ealth                         RX                   B ear, S tearns & C o            buy                      07/11/01
                                                            M errill Lynch                   near-term accum ulate    07/06/01
                                                            U B S W arburg                   buy                      07/05/01
                                                            Lehm an B rothers                strong buy               07/05/01
                                                            T hom as W eisel P artners       strong buy               07/05/01
                                                            R aym ond Jam es                 buy                      07/03/01
                                                            A dvest Inc.                     buy                      06/21/01
                                                            P rudential S ecurities          buy                      06/15/01
                                                            S G C ow en                      buy                      06/15/01
                                                            G oldm an S achs & C o.          recom m end list         06/11/01
  Infocure C orp.                      IN C X               M errill Lynch                   near-term accum ulate    05/30/01
                                                            S alom on S m ith B arney        buy                      04/20/01
                                                            J.P . M oragn                    long0term buy            04/20/01
  Inrange T echnologies                IN R G    9/22/00    M errill Lynch                   near-term accum ulate    05/30/01
                                                            S alom on S m ith B arney        buy                      04/20/01
  Instinet G roup Inc                  IN E T               W R H am brecht + C o            buy                      07/10/01
                                                            U .S . B ancorp P iper Jaffrey   buy                      07/09/01
                                                            R aym ond Jam es F inancial      m arket perform          07/06/01
                                                            H ornblow er F ischer A G        buy                      07/03/01
                                                            M errill Lynch                   near-term neutral        06/26/01
  Inverness M edical T echnology Inc   IM A                 U B S W arburg                   hold                     07/06/01
                                                            Lehm an B rothers                strong buy               07/02/01
                                                            A B N A m ro                     buy                      05/11/01
                                                            Leerink S wann & C o             hold                     05/09/01
                                                            G runtal & C o                   not rated                05/09/01
  Johnson & Johnson                    JN J                 A B N A m ro                     buy                      07/10/01
                                                            D eutsche B anc A lex B rown     buy                      07/10/01
                                                            Lehm an B rothers                buy                      07/09/01
                                                            S G C ow en                      buy                      07/02/01
                                                            B anc of A m erica               strong buy               06/29/01
  K ansas C ity S outhern              KSU                  M organ S tanley D ean W itter   neutral                  07/11/01
                                                            D eutsche B anc A lex B rown     buy                      07/02/01
                                                            M errill Lynch                   near-term neutral        05/17/01
                                                            A B N A m ro                     hold                     05/11/01
  K ey3M edia                          KME       8/21/00    Lazard F reres & C o             buy                      07/10/01
                                                            S G C ow en                      strong buy               05/08/01
  K raft Foods Inc                     K FT                 G oldm an S achs & C o.          m arket outperform       07/11/01
                                                            D avenport & C o                 buy                      07/10/01
                                                            M organ S tanley D ean W itter   outperform               07/10/01
                                                            B laylock & P artners            m arket outperform       07/09/01
                                                            Lehm an B rothers                strong buy               07/09/01
  Lucent                               LU                   C IB C W orld M arkets           buy                      07/11/01
                                                            C redit S uisse F irst B oston   hold                     07/11/01
                                                            M organ S tanley D ean W itter   outperform               07/10/01
                                                            D resdner K leinw ort W ass      buy                      07/05/01
                                                            S G C ow en                      neutral                  07/02/01
  Lum inent Inc                        LM N E    11/10/00   P M G C apital                   buy                      07/10/01
                                                            R obertson S tephens             buy                      07/06/01
                                                            U .S . B ancorp P iper Jaffray   buy                      07/06/01
                                                            C redit S uisse F irst B oston   buy                      07/06/01
  M assey E nergy C o                  MEE       12/21/00   B ear, S tearns & C o            buy                      06/20/01
                                                            Lehm an B rothers                buy                      06/13/01
  M cD ata C orporation                MCDT       2/8/01    F irst A lbany C orp.            strong buy               07/10/01
                                                            W it S oundV iew                 hold                     07/09/01
                                                            R obinson-H um phrey C o.        neutral                  07/06/01
                                                            M errill Lynch                   near-term accum ulate    07/06/01
                                                            C redit S uisse F irst B oston   hold                     07/06/01
  M ethode E lectronics                METHA                R obert W . B aird & C o.        m arket outperform       04/23/01
  M irant                              M IR      9/27/00    M organ S tanley D ean W itter   strong buy               07/09/01
                                                            E dw ard Jones                   buy                      06/25/01
                                                            Lehm an B rothers                strong buy               06/22/01
                                                            B anc of A m erica               strong buy               06/18/01
  M onsanto C o                        MON       10/18/00   J.P . M organ & C o.             buy                      07/02/01
                                                            G oldm an S achs & C o.          recom m end list          6/28/01
                                                            D eutsche B anc A lex B rown     strong buy               06/19/01
                                                            U B S W arburg                   buy                      06/13/01
                                                            M errill Lynch                   near-term neutral        05/23/01
38                                                                                Spin-Off Research




                                      Analyst Coverage

                                      Spin-Off                                                       Research
               Company       Symbol    Date                  Analyst           Recommendation          Date
 Moody's                     MCO       10/2/00   Goldman Sachs & Co.          market outperform       07/09/01
                                                 Dresdner Kleinwort Wass      add                     06/07/01
 Motorola Inc.               MOT                 SG Cowen                     buy                     07/11/01
                                                 Lehman Brothers              market perform          07/11/01
                                                 Deutsche Banc Alex Brown     market perform          07/10/01
                                                 ABN Amro                     add                     07/10/01
                                                 Credit Suisse First Boston   buy                     07/09/01
 MRV Communications          MRVC                Wells Fargo Van Kasper       buy                     07/11/01
 Nextel                      NXTL                First Union Securities       buy                     07/11/01
                                                 Morgan Stanley Dean Witter   outperform              07/10/01
                                                 Thomas Weisel Partners       strong buy              07/05/01
                                                 Gerard Klauer Mattison       buy                     06/28/01
                                                 Robinson-Humphrey Co.        outperform              06/26/01
                                                 WR Hambrecht + Co            buy                     06/25/01
                                                 Jefferies & Co.              holf                    06/25/01
                                                 Wit Soundview                buy                     06/22/01
                                                 Blaylock & Partners          market outperform       06/21/01
 Nortel Networks             NT         5/2/00   CE Unterburg Towbiin         buy                     07/06/01
                                                 Dresdner Kleinwort Wass      hold                    07/05/01
                                                 SG Cowen                     neutral                 07/05/01
                                                 Lehman Brothers              buy                     07/02/01
                                                 National Bank Financial      buy                     06/29/01
 Novell Inc.                 NOVL       2002     Garden State Securities      strong buy              06/11/01
                                                 Goldman Sachs & Co.          market perform          06/11/01
                                                 Dresdner Kleinwort Wass      add                     05/23/01
 NRG Energy                  NRG       5/31/00   Morgan Stanley Dean Witter   outperform              07/11/01
                                                 Credit Lyonnais              buy                     07/10/01
                                                 CIBC World Markets           buy                     06/29/01
                                                 Lehman Brothers              strong buy              06/25/01
 Orckit                      ORCT                Lehman Brothers              market perform          07/06/01
                                                 Dresdner Kleinwort Wass      buy                     05/03/01
                                                 CIBC World Markets           strong buy              04/24/01
 Orient-Express Hotels Ltd   OEH       8/10/00   Lazard Freres & Co           buy                     07/10/01
                                                 ABN Amro                     hold                    07/09/01
                                                 Goldman, Sachs & Co          market outperform       06/11/01
                                                 Merrill Lynch                near-term buy           04/09/01
 OSCA Inc                    OSCA                Salomon Smith Barney         buy                     05/16/01
                                                 Morgan Stanley Dean Witter   outperform              05/04/01
                                                 Johnson Rice & Co            buy                     05/03/01
                                                 Dain Rauscher Wessels        buy                     03/12/01
 Palm                        PALM      7/27/00   market perform               strong buy              07/11/01
                                                 Wit Soundview                hold                    07/09/01
                                                 Morgan Stanley Dean Witter   neutral                 07/05/01
 PFSweb                      PFSW       7/7/00   J.P. Morgan & Co.            long-term buy           04/04/01
 Pharmacia                   PHA                 Prudential Securities        buy                     07/10/01
                                                 Deutsche Banc Alex Brown     buy                     07/06/01
                                                 Leerink Swann & Co.          attractive              06/19/01
                                                 Swedbank                     accumulate              06/14/01
                                                 SG Cowen                     strong buy              06/14/01
                                                 ABN Amro                     hold                    06/13/01
 Phlip Morris Companies      MO                  Morgan Stanley Dean Witter   strong buy              07/09/01
                                                 Merrill Lynch                near-term accumulate    06/21/01
                                                 Goldman Sachs & Co.          recommend list          06/20/01
                                                 Credit Suisse First Boston   buy                     06/21/01
                                                 Hornblower Fischer AG        buy                     05/04/01
Spin-Off Research                                                                                            39




                                         Analyst Coverage

                                         Spin-Off                                                        Research
              Company           Symbol    Date                   Analyst           Recommendation          Date
  Phoenix Online                UOPX      9/28/00   Pacific Growth Equities       long-term buy           06/28/01
                                                    Gerard Klauer Mattison        neutral                 06/28/01
                                                    Barrington Research Assoc.    hold                    06/27/01
                                                    U.S. Bancorp Piper Jaffrey    strong buy              06/26/01
  Pitney Bowes Inc.             PBI                 Morgan Stanley Dean W itter   neutral                 06/21/01
                                                    Credit Suisse First Boston    hold                    06/15/01
                                                    Goldman Sachs & Co.           market outperform       06/15/01
                                                    Lehman Brothers               strong buy              06/15/01
                                                    UBS W arburg                  buy                     06/04/01
  Quantum Corp.-DLT & Storage   DSS                 W it SoundView                buy                     06/14/01
                                                    J.P. Morgan & Co.             long-term buy           06/14/01
                                                    ABN Amro                      hold                    06/14/01
                                                    Morgan Stanley Dean W itter   neutral                 06/14/01
                                                    Salomon Smith Barney          neutral                 06/06/01
  Rainbow Media Group           RMG       3/30/01   ABN Amro                      buy                     07/06/01
                                                    Merrill Lynch                 near-term accumulate    07/05/01
                                                    Morgan Stanley Dean W itter   neutral                 07/02/01
  Reliant Energy Inc.           REI                 Gerard Klauer Mattison        neutral                 06/28/01
                                                    Merrill Lynch                 near-term accumulate    06/15/01
                                                    Prudential Securities         hold                    06/15/01
                                                    Banc of America               strong buy              06/14/01
  Reliant Resources Inc         RRI       4/30/01   Credit Suisse First Boston    buy                     06/27/01
                                                    Deutsche Banc Alex Brown      buy                     06/22/01
                                                    Commerzbank Securities        buy                     06/21/01
                                                    Goldman Sachs & Co.           recommend list          06/15/01
                                                    Morgan Stanley Dean W itter   outperform              06/13/01
  Retek                         RETK      9/29/00   Sidoti & Company LLC          neutral                 07/05/01
                                                    Credit Suisse First Boston    buy                     06/18/01
                                                    Raymond James Financial       strong buy              06/15/01
  Reuters Group Plc             RTR LN              UBS W arburg                  hold                    06/27/01
                                                    ABN Amro                      add                     06/27/01
                                                    Merrill Lynch                 near-term neutral       06/22/01
                                                    Schroder Salomon Smith        buy                     06/22/01
  Riverstone Networks Inc       RSTN      2/15/01   Merrill Lynch                 near-term accumulate    07/11/01
                                                    Robertson Stephens            buy                     07/11/01
                                                    CE Unterburg Towbin           buy                     07/11/01
                                                    Credit Suisse First Boston    buy                     06/27/01
                                                    SG Cowen                      buy                     06/22/01
  Rockwell International        ROK                 Lehman Brothers               buy                     06/27/01
                                                    Prudential Securities         hold                    06/22/01
                                                    ABN Amro                      hold                    06/22/01
  Roxio Inc                     ROXI                B. Riley & Company, Inc       market outperform       05/30/01
                                                    Morgan Stanley Dean W itter   neutral                 05/21/01
  Sabre Group Holdings          TSG       3/15/00   Morgan Stanley Dean W itter   outperform              07/02/01
                                                    Bear, Stearns & Co            buy                     06/26/01
                                                    CIBC W orld Markets           buy                     06/22/01
  Sara Lee                      SLE                 Goldman Sachs & Co.           recommend list          07/03/01
                                                    Lehman Brothers               market outperform       07/03/01
                                                    Bear, Stearns & Co            neutral                 07/03/01
                                                    Banc of America               market perform          07/03/01
                                                    Prudential Securities         hold                    07/02/01
  Silicon Graphics              SGI                 Salomon Smith Barney          underpeform             07/10/01
                                                    Goldman Sachs & Co.           market perform          06/11/01
                                                    BNP Paribas                   outperform              04/06/01
  Southern Company              SO                  Gerard Klauer Mattison        neutral                 06/28/01
                                                    Edward Jones                  model portfolio         06/25/01
                                                    Commerzbank Securities        accumulate              06/19/01
  SPX                           SPW                 Merrill Lynch                 near-term buy           07/06/01
                                                    Lazard Freres & Co.           buy                     06/28/01
  St. Joe                       JOE                 Raymond James Financial       strong buy              05/24/01
                                                    Morgan Stanley Dean W itter   outperform              04/19/01
40                                                                                    Spin-Off Research




                                      Analyst Coverage

                                      Spin-Off                                                            Research
               Company       Symbol    Date                      Analyst           Recommendation           Date
 Stilwell Financial          SV        7/12/00      Keefe, Bruyette & W oods      underperform             07/09/01
                                                    CIBC W orld Markets           strong buy               07/03/01
                                                    Banc of Am erica              buy                      07/03/01
                                                    Deutsche Banc Alex Brown      m arket perform          07/02/01
 Stratos Lightwave Inc       STLW      4/30/01      Lehm an Brothers              strong buy               06/11/01
                                                    Merrill Lynch                 near-term neutral        06/07/01
                                                    U.S. Bancorp Piper Jaffrey    buy                      06/07/01
                                                    Jefferies & Co                hold                     05/22/01
 Switchboard.com             SW BD      3/2/00      Robertson Stephens            m arket p                05/21/01
                                                    J.P. Morgan                   buy                      05/07/01
                                                    W it Soundview                buy                      11/03/00
 Sybron Dental Specialties   SYD       12/11/00     Tucker Anthony Sutro Ca       strong buy               07/10/01
                                                    G oldm an Sachs & Co.         m arket perform          06/11/01
 Synavant                    SNVT       9/1/00      G runtal & Co.                short-term outperform    06/07/01
                                                    Adam s, Harkness & Hill       m arket perform          05/31/01
                                                    UBS W arburg                  buy                      04/05/01
 Technology Solutions        TSCC                   Adam s, Harkness & Hill       buy                      07/09/01
 Therm o Fibertek Inc        TFT      2nd Half 01   Barrington Research Assoc     Long-term buy            07/10/01
                                                    J.P. Morgan                   Long-term buy            07/02/01
 Titan Corp.                 TTN                    G erard Klauer Mattison       buy                      06/28/01
                                                    Credit Suisse First Boston    strong buy               05/17/01
                                                    CJS Securities                strong buy               05/04/01
                                                    B. Riley & Com pany, Inc      strong buy               05/04/01
                                                    BB&T Capital                  long-term buy            05/04/01
 TNPC                        NPW       10/5/00      J.P. Morgan & Co.             long-term buy            05/21/01
                                                    CIBC W orld Markets           buy                      04/24/01
 TYCO                        TYC                    Merrill Lynch                 near-term buy            07/11/01
                                                    ABN Am ro                     buy                      07/05/01
                                                    UBS W arburg                  buy                      07/02/01
                                                    Bear, Stearns & Co            buy                      06/26/01
                                                    Lehm an Brothers              strong buy               06/26/01
                                                    Deutsche Banc Alex Brown      strong buy               06/21/01
                                                    G oldm an Sachs & Co.         recom m end list         06/11/01
 TyCom                       TCM       7/27/00      Merrill Lynch                 near-term buy            03/26/01
                                                    Credit Suisse First Boston    buy                      03/05/01
                                                    J.P. Morgan & Co.             long-term buy            03/05/01
                                                    Deutsche Banc Alex Brown      buy                      03/02/01
                                                    Lehm an Brothers              buy                      02/28/01
                                                    UBS W arburg                  buy                      10/25/00
 Ulticom                     ULCM       4/5/00      Lehm an Brothers              strong buy               07/10/01
                                                    ABN Am ro                     ADD                      06/06/01
                                                    J.P. Morgan                   buy                      06/01/01
                                                    Raym ond Jam es Financial     buy                      06/01/01
                                                    Bear, Stearns & Co            buy                      06/01/01
 USA Networks                USAI                   Morgan Stanley Dean W itter   outperform               07/03/01
                                                    Prudential Securities         buy                      07/02/01
                                                    Thom as W eisel Partners      strong buy               06/27/01
                                                    SG Cowen                      strong buy               06/26/01
 USX-Marathon G roup Inc     MRO                    ABN Am ro                     buy                      07/10/01
                                                    Prudential Securities         buy                      07/03/01
                                                    Lehm an Brothers              strong buy               07/03/01
                                                    G oldm an Sachs & Co.         m arket perform          06/29/01
                                                    BMO Nesbitt Burns             outperform               06/25/01
 USX-U.S. Steel Group        X                      G oldm an Sachs & Co.         m arket perform          06/11/01
                                                    Salom on Sm ith Barney        buy                      06/06/01
                                                    J.P. Morgan                   buy                      06/06/01
                                                    Sanford C. Bernstein          outperform               05/23/01
                                                    Merrill Lynch                 near-term neutral        05/21/01
 Verizon                     VZ                     Thom as W eisel Partners      m arket perform          07/06/01
                                                    Deutsche Banc Alex Brown      buy                      07/06/01
                                                    Lehm an Brothers              strong buy               07/06/01
                                                    Credit Suisse First Boston    buy                      07/05/01
                                                    Dresdner Kleinwort Bens       buy                      06/29/01
                                                    ABN Am ro                     buy                      06/27/01
Spin-Off Research                                                                                        41




                                         Analyst Coverage

                                         Spin-Off                                                    Research
                Company         Symbol    Date                  Analyst        Recommendation          Date
  Weatherford                   WFT                 Dresdner Kleinwort Bens   add                     07/09/01
                                                    First Union Securities    strong buy              07/05/01
                                                    Prudential Securities     hold                    07/03/01
                                                    ABN Amro                  hold                    07/02/01
                                                    Salomon Smith Barney      outperform              07/02/01
  Williams Energy Partners LP   WEG        2/6/01   Banc of America           strong buy              03/05/01
                                                    A.G. Edwards              buy                     03/05/01
                                                    Dain Rauscher Wessels     buy                     03/05/01
                                                    Lehman Brothers           strong buy              03/05/01
  WorldCom Inc-MCI Group        MCIT                Argus Research Corp       hold                    07/02/01
                                                    Prudential Securities     hold                    06/27/01
                                                    Edward Jones              hold                    06/12/01
                                                    Morgan Keegan             market perform          06/12/01
                                                    Merrill Lynch             near-term accumulate    06/12/01
  WorldCom Inc-WorldCom Group   WCOM                Goldman Sachs & Co.       market outperform       07/11/01
                                                    ABN Amro                  hold                    07/09/01
                                                    Robertson Stephens        buy                     07/06/01
                                                    Merrill Lynch             near-term neutral       07/06/01
                                                    UBS Warburg               strong buy              07/06/01
  Xcel Energy                   XEL                 Gerard Klauer Mattison    neutral                 06/28/01
                                                    Banc of America           buy                     06/22/01
                                                    Goldman Sachs & Co.       market perform          06/15/01
  Zengine                       ZNGN      9/22/00   Friedman, Billings, Ram   market perform          06/01/01
                                                    Friedman, Billings, Ram   market perform          06/01/01
                                                    William Blair & Co.       Long-term buy           03/05/01
42                                                                                                                Spin-Off Research



                                       Valuation Snapshot


                               ALCATEL SA / ALCATEL OPTRONICS
ALCATEL SA (CGE FP)                              33-1-40-76-10-10 ALCATEL OPTRONICS (CGO FP)                       33-01-64-49-44-39
Current Price (Euros)                   20.66                      Current Price | 01-EPS est.                10.80 E0.61 | 17.79 X
Shares Out (000)                    1,212,303                      Shares Out / Float                        16,500
Market Cap (000) (Euros)          25,046,180                       Market Cap (000)                         178,200
Enterprise Value (000) (Euros)    29,811,180                       Enterprise Value             $           172,500
Sales 12 Month Trailing (000)     31,408,000                       TTM Sales | Price / Sales    $           177,100        1.01 X
Book Per Share (Euros)                  12.70                      Book Value | Price / Book                   3.44        3.14 X
Insider / Inst. Held                 2%                 10 %       Insider / Inst. Held                 0%                  7%
Short Int. / Ratio                #VALUE!         #N/A N.A.        Short Int. / Ratio                #VALUE!          #N/A N.A.
52 Week Range                  $16.73 - $97.15                     52 Week Range                    $9.55 - $90
CGE FP ownership of CGO FP                       With CGO FP | multiple                        Without CGO FP per share | multiple
Shares owned (000)                     13,530    Price-to-Sales            $25.91 | 0.8 X      Price-to-Sales          $25.76 | 0.8 X
Ratio per CGE FP share                 0.0112    Price-to-Book             $12.7 | 1.63 X      Price-to-Book          $12.28 | 1.67 X
Value per CGE FP share              $0.12        Price/Earnings             $-0.33 | -- X      Price/Earnings           $-0.34 | -- X
CGE FP Stub Value                  $20.54        Price/EBITDA              $2.85 | 7.25 X      Price/EBITDA            $2.83 | 7.26 X
Economic/Voting Interest         82% / 82%       Enterpr./EBITDA                8.61 X         Enterpr./EBITDA             8.65 X
CGE FP Relationship with CGO FP                                    Comparables                         JDSU                 GLW
Intend to Spin                       No                            Price-to-Sales                      3.48 X              1.94 X
IRS Tax Free Ruling                   0                            Price-to-Book                       0.81 X              2.55 X
Record Date / Distr. Date             0                          0 Price/Earnings                       0X                18.75 X
CGO FP IPO Date /Price           10/20/2000       $         85.00 Price/EBITDA                       #VALUE!               8.12 X
IPO Lockup Expires               #N/A N.A.                         Enterpr./EBITDA                   #VALUE!               9.81 X
Shares to Distribute / Float        4.6 X
                                                                                                 Spread Relationship
                                   Implied CGE FP       CGE FP         CGO FP
                                                                                                 40 Day Average         $        20.62
                       25.00                                                                     40 Day Variance                  0.58
                                                                                                 40 Day St. Dev         $         0.76
                       20.00                                                                     40 Day Correlation              (0.17)
     Value per share




                       15.00                                                                     20 Day Average         $        20.34
                                                                                                 20 Day Variance                  0.18
                       10.00
                                                                                                 20 Day St. Dev         $         0.43
                                                                                                 20 Day Correlation              (0.29)
                        5.00
                                                                                                 10 Day Average         $        20.20
                                                                                                 10 Day Variance                  0.03
                         -
                                                                                                 10 Day St. Dev         $         0.17
                        03 /01

                        03 /01

                        04 /01

                        04 /01

                        04 /01

                        04 /01

                        05 /01

                        05 /01

                        05 /01

                        05 /01

                        06 /01

                        06 /01

                        06 /01

                        06 /01

                        07 /01

                        07 /01

                        07 /01

                        07 /01

                        08 /01
                                01




                                                                                                 10 Day Correlation               0.28
                             1/
                             6

                             3

                             0

                             6

                             6

                             3

                             0

                             7

                             4

                             1

                             9

                             5

                             2

                             9

                             6

                             3

                             1

                             8

                             5
                          /1

                          /2

                          /3

                          /0

                          /1

                          /2

                          /3

                          /0

                          /1

                          /2

                          /2

                          /0

                          /1

                          /1

                          /2

                          /0

                          /1

                          /1

                          /2

                          /0
                       03




Alcatel SA develops, produces, and distributes telecommunications equipment and cables, and offers telecommunications services.
The company manufactures and markets mobile telephones, microwave radio systems, switching equipment and underwater
networks, printed circuit boards, inductive components, converters, and optronics and solutions for utilities, cable TV operators, and
the Internet.

Alcatel Optronics manufactures electronic components. The company produces lasers, pump lasers, optical amplifier modules,
optical interface modules, optical routing modules, and passive devices which create, extend, receive, or process optical signals
traveling through an optical fiber. Alcatel Optronics manufactures its components in France, the United States, and Canada.
Spin-Off Research                                                                                                                       43



                                                   Valuation Snapshot
                                     APOLLO GROUP / UNIV PHOENIX ONLINE
        APOLLO GROUP (APOL)                                     480-966-5394 UNIV PHOENIX ONLINE (UOPX)                          800-765-4922
        Current Price                   $        44.39                        Current Price | 01-EPS est. $              33.00 $0.32 | 102.48 X
        Shares Out (000)                      116,240                         Shares Out / Float                       126.741
        Market Cap (000)                $ 5,159,894                           Market Cap (000)             $         4,182,437
        Enterprise Value (000)          $ 4,892,844                           Enterprise Value             $         4,182,437
        Sales 12 Month Trailing (000)   $     719,370                         TTM Sales | Price / Sales    $            75,400     55.93 X
        Book Per Share                  $         3.80                        Book Value | Price / Book    $              0.05      660 X
        Insider / Inst. Held                 36 %                 68 %        Insider / Inst. Held                 90 %              11 %
        Short Int. / Ratio                      2.1343                1.3800 Short Int. / Ratio                 #VALUE!        #N/A N.A.
        52 Week Range                   $21.63 - $46.13                       52 Week Range                   $9.27 - $40.13
        APOL ownership of UOPX                              With UOPX | multiple                          Without UOPX per share | multiple
        Shares owned (000)                      46,750 Price-to-Sales                 $6.19 | 7.17 X      Price-to-Sales        $5.54 | 5.62 X
        Ratio per APOL share                    0.4022 Price-to-Book                  $3.8 | 11.68 X      Price-to-Book         $3.69 | 8.43 X
        Value per APOL share                $13.27          Price/Earnings           $0.89 | 49.76 X      Price/Earnings       $0.76 | 40.95 X
        APOL Stub Value                     $31.12          Price/EBITDA             $1.55 | 28.64 X      Price/EBITDA         $1.28 | 24.31 X
        Economic/Voting Interest          37% / 37% Enterpr./EBITDA                       27.22 X         Enterpr./EBITDA          22.48 X
        APOL Relationship with UOPX                                           Comparables                           ESI               DV
        Intend to Spin                  Tracking Stock                        Price-to-Sales                      2.64 X            4.91 X
        IRS Tax Free Ruling                   N/A                             Price-to-Book                      13.28 X           10.13 X
        Record Date / Distr. Date             N/A                  N/A        Price/Earnings                     28.99 X           47.36 X
        UOPX IPO Date /Price              9/27/2000          $          14.00 Price/EBITDA                       16.18 X           22.72 X
        IPO Lockup Expires                3/26/2001                           Enterpr./EBITDA                    15.11 X           22.53 X
        Shares to Distribute / Float         0.6 X
                                                Implied APOL       APOL       UOPX
                                                                                                          Spread Relationship
                                                                                                          40 Day Average       $         31.70
                            $50.00                                                                        40 Day Variance                  3.87
                            $45.00                                                                        40 Day St. Dev       $           1.97
                            $40.00                                                                        40 Day Correlation               0.76
                            $35.00
          Value per share




                            $30.00
                                                                                                        20 Day Average        $         31.15
                                                                                                        20 Day Variance                  0.83
                            $25.00
                                                                                                        20 Day St. Dev        $          1.92
                            $20.00
                                                                                                        20 Day Correlation               0.60
                            $15.00

                            $10.00                                                                      10 Day Average        $         29.84
                             $5.00                                                                      10 Day Variance                  0.77
                              $-                                                                        10 Day St. Dev        $          1.32
                                                                                                        10 Day Correlation              (0.09)
                             03 01

                             03 01

                             04 01

                             04 01

                             04 01

                             04 01

                             04 01

                             05 01

                             05 01

                             05 01

                             05 01

                             05 01

                             05 01

                             06 01

                             06 01

                             06 01

                             06 01

                             06 01

                             07 01

                             07 01

                             07 01

                             07 01

                             07 01

                             08 01
                                   01
                                 6/

                                 2/

                                 8/

                                 3/

                                 9/

                                 6/

                                 0/

                                 6/

                                 2/

                                 8/

                                 4/

                                 8/

                                 4/

                                 1/

                                 6/

                                 2/

                                 8/

                                 2/

                                 8/

                                 5/

                                 1/

                                 7/

                                 3/

                                 7/

                                 2/
                               /1

                               /2

                               /2

                               /0

                               /0

                               /1

                               /2

                               /2

                               /0

                               /0

                               /1

                               /1

                               /2

                               /3

                               /0

                               /1

                               /1

                               /2

                               /2

                               /0

                               /1

                               /1

                               /2

                               /2

                               /0
                             03




        Apollo Group, Inc. provides higher education programs for working adults. The company's subsidiaries include the University of
        Phoenix, the Institute for Professional Development, the College for Financial Planning, and Western International University.
        Apollo offers accredited degree programs, certificate programs, and customized training at campuses in the United States and Canada.

        University of Phoenix Online is a division of the University of Phoenix, Inc., a wholly owned subsidiary of the Apollo Group. The
        company is an online provider of accessible, accredited education programs for working adults.
44                                                                                                                                                                                                         Spin-Off Research



                                                                                               Valuation Snapshot
                                                                           FMC CORP / FMC TECHNOLOGIES
FMC CORP (FMC)                                                                                      312-861-6000 FMC TECHNOLOGIES (FTI)                                 312-861-6000
Current Price                                                          $       63.46                                Current Price | 01-EPS est. $              17.60 $0.91 | 19.38 X
Shares Out (000)                                                              31,116                                Shares Out / Float                        65,000
Market Cap (000)                                                       $ 1,974,621                                  Market Cap (000)             $         1,144,000
Enterprise Value (000)                                                 $ 3,342,521                                  Enterprise Value             $         1,167,300
Sales 12 Month Trailing (000)                                          $ 3,798,500                                  TTM Sales | Price / Sales    $         1,875,200       0.61 X
Book Per Share                                                         $       25.23                                Book Value | Price / Book    $              9.88       1.78 X
Insider / Inst. Held                                                       30 %                       73 %          Insider / Inst. Held                 0%                  3%
Short Int. / Ratio                                                            0.2581                       0.7300 Short Int. / Ratio                          1.2840 #N/A N.A.
52 Week Range                                                           $62.13 - $84                                52 Week Range                  $17.41 - $22.48
FMC ownership of FTI                                                                            With FTI | multiple                             Without FTI per share | multiple
Shares owned (000)                                                                  53,685 Price-to-Sales                 $122.08 | 0.52 X      Price-to-Sales        $61.81 | 0.54 X
Ratio per FMC share                                                                 1.7253 Price-to-Book                   $25.23 | 2.52 X      Price-to-Book          $4.59 | 7.21 X
Value per FMC share                                                             $30.37          Price/Earnings              $4.4 | 14.42 X      Price/Earnings        $2.83 | 11.69 X
FMC Stub Value                                                                  $33.09          Price/EBITDA               $17.49 | 3.63 X      Price/EBITDA          $12.54 | 2.64 X
Economic/Voting Interest                                                      83% / 83% Enterpr./EBITDA                         6.14 X          Enterpr./EBITDA            6.08 X
FMC Relationship with FTI                                                                                           Comparables                         DOW                 HPC
Intend to Spin                                                                    Yes                               Price-to-Sales                      1.2 X              0.38 X
IRS Tax Free Ruling                                                            Pending                              Price-to-Book                       2.98 X             1.51 X
Record Date / Distr. Date                                                          0                  4Q-01         Price/Earnings                     37.28 X            35.74 X
FTI IPO Date /Price                                                           6/13/2001          $          20.00 Price/EBITDA                        #VALUE!              1.98 X
IPO Lockup Expires                                                            #N/A N.A.                             Enterpr./EBITDA                   #VALUE!              7.33 X
Shares to Distribute / Float                                                     4.7 X
                                                                                    Implied FMC        FMC        FTI
                                                                                                                                                Spread Relationship
                                                                                                                                                40 Day Average        $          37.59
                       $90.00                                                                                                                   40 Day Variance                  83.61
                       $80.00                                                                                                                   40 Day St. Dev        $           9.14
                       $70.00
                                                                                                                                                40 Day Correlation               (0.32)
     Value per share




                       $60.00
                                                                                                                                                                                             20 Day Average       $   35.26
                       $50.00
                                                                                                                                                                                             20 Day Variance           2.43
                       $40.00
                                                                                                                                                                                             20 Day St. Dev       $    1.51
                       $30.00                                                                                                                                                                20 Day Correlation        0.30
                       $20.00

                       $10.00                                                                                                                                                                10 Day Average       $   34.17
                        $0.00
                                                                                                                                                                                             10 Day Variance           1.49
                                                                                                                                                                                             10 Day St. Dev       $    0.72
                             01



                                        01



                                                   01



                                                              01



                                                                         01



                                                                                     01



                                                                                                01



                                                                                                           01



                                                                                                                      01



                                                                                                                                 01



                                                                                                                                            01



                                                                                                                                                       01



                                                                                                                                                                  01



                                                                                                                                                                             01



                                                                                                                                                                                        01
                           6/



                                      7/



                                                 5/



                                                            7/



                                                                       6/



                                                                                   7/



                                                                                              6/



                                                                                                         5/



                                                                                                                    6/



                                                                                                                               5/



                                                                                                                                          6/



                                                                                                                                                     6/



                                                                                                                                                                7/



                                                                                                                                                                           6/



                                                                                                                                                                                      6/




                                                                                                                                                                                             10 Day Correlation        0.81
                         /1



                                    /2



                                               /0



                                                          /1



                                                                     /2



                                                                                 /0



                                                                                            /1



                                                                                                       /2



                                                                                                                  /0



                                                                                                                             /1



                                                                                                                                        /2



                                                                                                                                                   /0



                                                                                                                                                              /1



                                                                                                                                                                         /2



                                                                                                                                                                                    /0
                       03



                                  03



                                             04



                                                        04



                                                                   04



                                                                               05



                                                                                          05



                                                                                                     05



                                                                                                                06



                                                                                                                           06



                                                                                                                                      06



                                                                                                                                                 07



                                                                                                                                                            07



                                                                                                                                                                       07



                                                                                                                                                                                  08




FMC Corporation produces chemicals and machinery for industry and agriculture. The company's principal business segments are
industrial chemicals, specialty chemicals, energy systems, food and transportation systems, and agricultural products.

FMC Technologies, Inc., designs, manufactures, and services systems and products used in offshore, particularly deepwater,
exploration and production of crude oil and natural gas. The company also provides advanced handling and processing systems to
industrial customers. FMC Technologies' subsea products include drilling and production systems, subsea tree systems, and fluid
control systems.
Spin-Off Research                                                                                                                         45



                                                   Valuation Snapshot
                                       GEN MOTORS CORP / HUGHES ELECTRONICS
          GEN MOTORS CORP (GM)                                  313-556-5000 HUGHES ELECTRONICS (GMH)                            310-662-9688
          Current Price                 $        63.03                        Current Price | 01-EPS est. $              19.80   $-0.45 | -- X
          Shares Out (000)                     559,000                        Shares Out / Float                       875,900
          Market Cap (000)              $ 35,233,770                          Market Cap (000)             $        17,342,820
          Enterprise Value (000)        $ 159,194,770                         Enterprise Value             $        18,692,320
          Sales 12 Month Trailing (000) $ 177,765,000                         TTM Sales | Price / Sales    $         7,625,600      2.27 X
          Book Per Share                $        53.97                        Book Value | Price / Book    $             13.72      1.44 X
          Insider / Inst. Held               13 %                 56 %        Insider / Inst. Held                 8%                77 %
          Short Int. / Ratio                    7.9757                3.1900 Short Int. / Ratio                 #VALUE!        #N/A N.A.
          52 Week Range                 $48.44 - $76.63                       52 Week Range                    $17.5 - $38
          GM ownership of GMH                               With GMH | multiple                           Without GMH per share | multiple
          Shares owned (000)                   415,020 Price-to-Sales                $318.01 | 0.2 X      Price-to-Sales       $304.36 | 0.16 X
          Ratio per GM share                    0.7424 Price-to-Book                 $53.97 | 1.17 X      Price-to-Book        $31.56 | 1.53 X
          Value per GM share                 $14.7          Price/Earnings            $4.07 | 15.5 X      Price/Earnings        $4.4 | 10.98 X
          GM Stub Value                     $48.33          Price/EBITDA                 #VALUE!          Price/EBITDA            #VALUE!
          Economic/Voting Interest        47% / 47% Enterpr./EBITDA                      #VALUE!          Enterpr./EBITDA         #VALUE!
          GM Relationship with GMH                                            Comparables                            F            DCX GR
          Intend to Spin                       ?                              Price-to-Sales                      0.26 X            0.36 X
          IRS Tax Free Ruling                  0                              Price-to-Book                       3.28 X            1.39 X
          Record Date / Distr. Date            0                            0 Price/Earnings                     20.53 X           50.02 X
          GMH IPO Date /Price             #N/A N.A.          #N/A N.A.        Price/EBITDA                        2.08 X            3.92 X
          IPO Lockup Expires              #N/A N.A.                           Enterpr./EBITDA                     9.55 X            9.67 X
          Shares to Distribute / Float       0.9 X
                                                  Implied GM        GM       GMH
                                                                                                          Spread Relationship
                                                                                                          40 Day Average       $         48.42
                $80.00                                                                                    40 Day Variance                  3.75
                $70.00                                                                                    40 Day St. Dev       $           1.94
                                                                                                          40 Day Correlation              (0.14)
                              $60.00
            Value per share




                              $50.00                                                                      20 Day Average        $         49.67
                                                                                                          20 Day Variance                  2.01
                              $40.00
                                                                                                          20 Day St. Dev        $          1.36
                              $30.00                                                                      20 Day Correlation               0.28
                              $20.00
                                                                                                          10 Day Average        $         48.77
                              $10.00
                                                                                                          10 Day Variance                  0.15
                                $-                                                                        10 Day St. Dev        $          0.51
                                                                                                          10 Day Correlation              (0.13)
                               03 /01

                               03 01

                               04 /01

                               04 01

                               04 /01

                               04 /01

                               04 /01

                               05 /01

                               05 /01

                               05 /01

                               05 /01

                               05 /01

                               05 /01

                               06 /01

                               06 /01

                               06 /01

                               06 /01

                               06 /01

                               07 /01

                               07 01

                               07 /01

                               07 /01

                               07 /01

                               08 /01
                                     01
                                   2/



                                   3/




                                   5/




                                   2/
                                   6



                                   8



                                   9

                                   6

                                   0

                                   6

                                   2

                                   8

                                   4

                                   8

                                   4

                                   1

                                   6

                                   2

                                   8

                                   2

                                   8



                                   1

                                   7

                                   3

                                   7
                                 /1

                                 /2

                                 /2

                                 /0

                                 /0

                                 /1

                                 /2

                                 /2

                                 /0

                                 /0

                                 /1

                                 /1

                                 /2

                                 /3

                                 /0

                                 /1

                                 /1

                                 /2

                                 /2

                                 /0

                                 /1

                                 /1

                                 /2

                                 /2

                                 /0
                               03




          General Motors Corporation manufactures and sells vehicles worldwide under the Chevrolet, Buick, Cadillac, Oldsmobile, Pontiac,
          Saturn, and GMC names. The company also has financing and insurance operations. In addition, General Motors produces products
          and provides services in other industries such as satellite and wireless communications.

          General Motors Corporation - Class H stock represents Hughes Electronics Corporation. Hughes Electronics designs,
          manufactures, and markets advanced electronic systems, including building communications satellites, providing telecommunications
          equipment, offering digital television entertainment and information programming via satellite, and operating a network of satellites.
46                                                                                                                       Spin-Off Research



                                              Valuation Snapshot
                                GLOBAL CROSSING / ASIA GLOBAL CROSSING
GLOBAL CROSSING (GX)                                          441-296-8600 ASIA GLOBAL CROSSING (AX)                             441-296-8600
Current Price                       $         6.20                           Current Price | 01-EPS est. $               4.85    $-0.61 | -- X
Shares Out (000)                           886,467                           Shares Out / Float                       554,600
Market Cap (000)                    $ 5,496,098                              Market Cap (000)             $         2,689,810
Enterprise Value (000)              $ 16,713,098                             Enterprise Value             $         3,361,890
Sales 12 Month Trailing (000)       $ 4,010,460                              TTM Sales | Price / Sales    $            87,320      30.31 X
Book Per Share                      $        11.66                           Book Value | Price / Book    $              3.06       1.58 X
Insider / Inst. Held                     40 %                   35 %         Insider / Inst. Held                 0%                 34 %
Short Int. / Ratio                         86.1072                  6.3500 Short Int. / Ratio                          0.2876           2.4200
52 Week Range                         $5 - $37.75                            52 Week Range                   $3.09 - $11.69
GX ownership of AX                                        With AX | multiple                             Without AX per share | multiple
Shares owned (000)                           315,625 Price-to-Sales                  $4.52 | 1.37 X      Price-to-Sales         $4.43 | 1.01 X
Ratio per GX share                            0.3560 Price-to-Book                  $11.66 | 0.53 X      Price-to-Book          $9.73 | 0.46 X
Value per GX share                        $1.73           Price/Earnings              $-3.17 | -- X      Price/Earnings          $-2.95 | -- X
GX Stub Value                             $4.47           Price/EBITDA             $-0.22 | -28.18 X     Price/EBITDA         $-0.08 | -55.88 X
Economic/Voting Interest                57% / 57% Enterpr./EBITDA                       -84.75 X         Enterpr./EBITDA          -199.59 X
GX Relationship with AX                                                      Comparables                          TCM                 Q
Intend to Spin                              No                               Price-to-Sales                      2.48 X             2.02 X
IRS Tax Free Ruling                          0                               Price-to-Book                       2.74 X             1.09 X
Record Date / Distr. Date                    0                             0 Price/Earnings                     16.34 X            62.94 X
AX IPO Date /Price                      10/5/2000          $           7.00 Price/EBITDA                        10.97 X             5.84 X
IPO Lockup Expires                       4/3/2001                            Enterpr./EBITDA                    11.87 X             9.14 X
Shares to Distribute / Float               1.3 X
                                                 Implied GX       GX        AX
                                                                                                         Spread Relationship
                                                                                                         40 Day Average        $           6.63
                       $18.00                                                                            40 Day Variance                   2.98
                       $16.00                                                                            40 Day St. Dev        $           1.73
                       $14.00
                                                                                                         40 Day Correlation               (0.25)
     Value per share




                       $12.00
                                                                                                       20 Day Average          $          5.52
                       $10.00                                                                          20 Day Variance                    0.94
                        $8.00                                                                          20 Day St. Dev          $          0.95
                                                                                                       20 Day Correlation                 0.43
                        $6.00

                        $4.00
                                                                                                       10 Day Average          $          4.79
                        $2.00                                                                          10 Day Variance                    0.37
                         $-                                                                            10 Day St. Dev          $          0.56
                                                                                                       10 Day Correlation                 0.60
                         03 /01

                         03 01

                         04 /01

                         04 01

                         04 01

                         04 01

                         04 01

                         05 01

                         05 01

                         05 01

                         05 01

                         05 01

                         05 /01

                         06 01

                         06 /01

                         06 01

                         06 /01

                         06 01

                         07 01

                         07 01

                         07 01

                         07 /01

                         07 01

                         08 /01
                                 01
                              2/



                              3/

                              9/

                              6/

                              0/

                              6/

                              2/

                              8/

                              4/

                              8/



                              1/



                              2/



                              2/

                              8/

                              5/

                              1/



                              3/



                              2/
                              6



                              8




                              4



                              6



                              8




                              7



                              7
                           /1

                           /2

                           /2

                           /0

                           /0

                           /1

                           /2

                           /2

                           /0

                           /0

                           /1

                           /1

                           /2

                           /3

                           /0

                           /1

                           /1

                           /2

                           /2

                           /0

                           /1

                           /1

                           /2

                           /2

                           /0
                        03




Global Crossing Ltd. provides integrated telecommunications solutions over an Internet protocol-based fiber optic network. The
company offers a variety of managed data and voice products and services. Global Crossing operates
throughout the Americas, Europe, and the Asia/Pacific region.

Asia Global Crossing Ltd., a telecommunications carrier, provides integrated Internet, data, voice, and Web-hosting services to
wholesale and business customers. The company is building an end-to-end network across Asia that will include subsea cables,
backhaul connections to our landing sites, national networks, city fiber rings, telehouses, and Web-hosting centers.
Spin-Off Research                                                                                                                        47



                                                   Valuation Snapshot
                                            LIMITED INC / INTIMATE BRANDS
          LIMITED INC (LTD)                                 614-415-7000 INTIMATE BRANDS (IBI)                                     614-415-6900
          Current Price                 $         16.30                     Current Price | 01-EPS est.   $              15.91 $0.82 | 19.45 X
          Shares Out (000)                     435,669                      Shares Out / Float                         475,200
          Market Cap (000)              $ 7,101,405                         Market Cap (000)               $         7,560,432
          Enterprise Value (000)        $ 7,349,475                         Enterprise Value               $         7,641,922
          Sales 12 Month Trailing (000) $ 10,080,940                        TTM Sales | Price / Sales      $         5,132,850        1.47 X
          Book Per Share                $          5.45                     Book Value | Price / Book      $               1.36       11.7 X
          Insider / Inst. Held               43 %              70 %         Insider / Inst. Held                   84 %                88 %
          Short Int. / Ratio                     4.1019            2.4200 Short Int. / Ratio                            4.3754            5.4200
          52 Week Range                 $14.44 - $27.88                     52 Week Range                    $12.31 - $24.31
          LTD ownership of IBI                          With IBI | multiple                               Without IBI per share | multiple
          Shares owned (000)                   394,416 Price-to-Sales               $23.14 | 0.7 X        Price-to-Sales         $11.36 | 0.17 X
          Ratio per LTD share                    0.9053 Price-to-Book               $5.45 | 2.99 X        Price-to-Book           $3.81 | 0.5 X
          Value per LTD share                $14.4      Price/Earnings             $0.89 | 18.38 X        Price/Earnings         $0.15 | 12.67 X
          LTD Stub Value                      $1.9      Price/EBITDA                $2.49 | 6.55 X        Price/EBITDA             $0 | 3.21 X
          Economic/Voting Interest        83% / 83% Enterpr./EBITDA                     6.78 X            Enterpr./EBITDA            62.78 X
          LTD Relationship with IBI                                         Comparables                            GPS                 ANN
          Intend to Spin                       No                           Price-to-Sales                        1.65 X              0.67 X
          IRS Tax Free Ruling                   0                           Price-to-Book                         7.56 X              1.43 X
          Record Date / Distr. Date             0                         0 Price/Earnings                       28.26 X             14.31 X
          IBI IPO Date /Price             10/23/1995 $              17.00 Price/EBITDA                           12.11 X              5.81 X
          IPO Lockup Expires              #N/A N.A.                         Enterpr./EBITDA                      12.97 X              6.54 X
          Shares to Distribute / Float       4.9 X
                                                                                                          Spread Relationship
                                                  Implied LTD       LTD        IBI
                                                                                                          40 Day Average      $           2.13
                               $20.00                                                                     40 Day Variance                 0.07
                               $18.00                                                                     40 Day St. Dev      $           0.26
                               $16.00                                                                     40 Day Correlation              0.94
             Value per share




                               $14.00
                               $12.00                                                                     20 Day Average        $         2.04
                               $10.00                                                                     20 Day Variance                 0.08
                                $8.00
                                                                                                          20 Day St. Dev        $         0.21
                                $6.00
                                                                                                          20 Day Correlation              0.86
                                $4.00
                                                                                                          10 Day Average        $         2.10
                                $2.00
                                                                                                          10 Day Variance                 0.04
                                $0.00
                                                                                                          10 Day St. Dev        $         0.20
                                 03 /01
                                 03 /01
                                 04 /01
                                 04 /01
                                 04 /01
                                 04 /01
                                 05 /01
                                 05 /01
                                 05 /01
                                 05 /01
                                 06 /01
                                 06 /01
                                 06 /01
                                 06 /01
                                 07 /01
                                 07 /01
                                 07 /01
                                 07 /01
                                 08 /01
                                         01




                                                                                                          10 Day Correlation              0.63
                                      1/
                                      6
                                      3
                                      0
                                      6
                                      6
                                      3
                                      0
                                      7
                                      4
                                      1
                                      9
                                      5
                                      2
                                      9
                                      6
                                      3
                                      1
                                      8
                                      5
                                   /1
                                   /2
                                   /3
                                   /0
                                   /1
                                   /2
                                   /3
                                   /0
                                   /1
                                   /2
                                   /2
                                   /0
                                   /1
                                   /1
                                   /2
                                   /0
                                   /1
                                   /1
                                   /2
                                   /0
                               03




          The Limited, Inc. is a specialty retailer. The company operates stores under the Lerner New York, Express, The Limited, Henri
          Bendel, Structure, and The Limited Too. The Limited also owns approximately 84% of Intimate Brands, Inc. which operates
          Victoria's Secret and Bath & Body Works stores, and 26% of Galyan's Trading Co.

          Intimate Brands, Inc. retails intimate apparel, beauty, and personal care products through the Victoria's Secret and Bath & Body
          Works brands. The company provides Victoria's Secret products through lingerie and beauty stores, catalogs, and the Internet.
          Intimate offers personal care, home fragrance, and decor products through Bath & Body Works and White Barn Candle Company
          stores.
48                                                                                                              Spin-Off Research



                                                Valuation Snapshot
                                          MRV COMM / LUMINENT INC
MRV COMM (MRVC)                                       818-773-0900 LUMINENT INC (LMNE)                                   818-773-9044
Current Price                    $         6.69                     Current Price | 01-EPS est.   $                3.05 $0.07 | 46.92 X
Shares Out (000)                         79,229                     Shares Out / Float                         156,000
Market Cap (000)                 $     530,044                      Market Cap (000)               $           475,800
Enterprise Value (000)           $     498,084                      Enterprise Value               $           363,490
Sales 12 Month Trailing (000)    $     354,430                      TTM Sales | Price / Sales      $           124,190       3.81 X
Book Per Share                   $        10.26                     Book Value | Price / Book      $               3.51      0.87 X
Insider / Inst. Held                  23 %               27 %       Insider / Inst. Held                   92 %               9%
Short Int. / Ratio                       6.2863              5.3400 Short Int. / Ratio                          9.0988          22.2100
52 Week Range                     $5.09 - $81.5                     52 Week Range                     $2.09 - $13.13
MRVC ownership of LMNE                            With LMNE | multiple                            Without LMNE per share | multiple
Shares owned (000)                       144,000 Price-to-Sales              $4.47 | 1.5 X        Price-to-Sales         $2.91 | 0.4 X
Ratio per MRVC share                       1.8175 Price-to-Book            $10.26 | 0.65 X        Price-to-Book         $2.75 | 0.42 X
Value per MRVC share                   $5.54      Price/Earnings           $0.08 | 83.63 X        Price/Earnings         $-0.04 | -- X
MRVC Stub Value                        $1.15      Price/EBITDA             $-0.15 | -44.6 X       Price/EBITDA          $0.02 | 57.5 X
Economic/Voting Interest             92% / 92% Enterpr./EBITDA                  -42.35 X          Enterpr./EBITDA          123.16 X
MRVC Relationship with LMNE                                         Comparables                           JDSU               CIEN
Intend to Spin                          Yes                         Price-to-Sales                        3.48 X            8.73 X
IRS Tax Free Ruling                     Yes                         Price-to-Book                         0.81 X            2.94 X
Record Date / Distr. Date                 0                0        Price/Earnings                          0X             47.58 X
LMNE IPO Date /Price                 11/9/2000     $          12.00 Price/EBITDA                        #VALUE!             34.05 X
IPO Lockup Expires                    5/8/2001                      Enterpr./EBITDA                     #VALUE!            32.19 X
Shares to Distribute / Float            12 X
                                          Implied MRVC    MRVC       LMNE
                                                                                                  Spread Relationship
                                                                                                  40 Day Average      $          1.23
                       $14.00                                                                     40 Day Variance                0.07
                       $12.00                                                                     40 Day St. Dev      $          0.26
                                                                                                  40 Day Correlation             0.97
                       $10.00
     Value per share




                        $8.00                                                                     20 Day Average       $         1.30
                                                                                                  20 Day Variance                0.37
                        $6.00
                                                                                                  20 Day St. Dev       $         0.27
                        $4.00                                                                     20 Day Correlation             0.89
                        $2.00
                                                                                                  10 Day Average       $         1.22
                         $-
                                                                                                  10 Day Variance                0.26
                       $(2.00)                                                                    10 Day St. Dev       $         0.35
                                                                                                  10 Day Correlation             0.78
                        03 01

                        03 01

                        04 01

                        04 01

                        04 01

                        04 01

                        04 01

                        05 01

                        05 01

                        05 01

                        05 01

                        05 01

                        05 01

                        06 01

                        06 01

                        06 01

                        06 01

                        06 01

                        07 01

                        07 01

                        07 01

                        07 01

                        07 01

                        08 01
                              01
                            6/

                            2/

                            8/

                            3/

                            9/

                            6/

                            0/

                            6/

                            2/

                            8/

                            4/

                            8/

                            4/

                            1/

                            6/

                            2/

                            8/

                            2/

                            8/

                            5/

                            1/

                            7/

                            3/

                            7/

                            2/
                          /1

                          /2

                          /2

                          /0

                          /0

                          /1

                          /2

                          /2

                          /0

                          /0

                          /1

                          /1

                          /2

                          /3

                          /0

                          /1

                          /1

                          /2

                          /2

                          /0

                          /1

                          /1

                          /2

                          /2

                          /0
                        03




MRV Communications, Inc. provides high-speed optical-networks, integrating switching, routing, remote access, and fiber-optic-
transmission systems that enhance performance of existing telecommunications networks. The company's solutions enhance the
functionality of LANs and WANs. MRV's fiber-optic-transmission products send voice, data, and video to carriers and residential
networks.

Luminent, Inc. designs, manufactures, and sells a line of fiber optic components that enable communications equipment
manufacturers to provide optical networking solutions. The company specializes in singlemode fiber optic components and
subsystems for high-capacity data transmission for long-reach applications in the metropolitan and access markets.
Spin-Off Research                                                                                                                       49



                                                Valuation Snapshot
                                      NETWORK ASSOC / MCAFEE.COM CORP
        NETWORK ASSOC (NETA)                                   408-988-3832 MCAFEE.COM CORP (MCAF)                               408-992-8100
        Current Price                   $        15.20                       Current Price | 01-EPS est. $              16.64     #VALUE!
        Shares Out (000)                       136,879                       Shares Out / Float                        44,697
        Market Cap (000)                $ 2,080,561                          Market Cap (000)             $           743,758
        Enterprise Value (000)          $ 2,064,941                          Enterprise Value             $           698,988
        Sales 12 Month Trailing (000)   $      663,820                       TTM Sales | Price / Sales    $            49,420      14.99 X
        Book Per Share                  $          2.85                      Book Value | Price / Book    $               1.15     14.47 X
        Insider / Inst. Held                  3%                 57 %        Insider / Inst. Held                 81 %               87 %
        Short Int. / Ratio                      3.0566               1.2800 Short Int. / Ratio                         0.5245           2.5100
        52 Week Range                     $3.25 - $27                        52 Week Range                   $1.81 - $29.13
        NETA ownership of MCAF                             With MCAF | multiple                          Without MCAF per share | multiple
        Shares owned (000)                         36,100 Price-to-Sales             $4.85 | 3.13 X      Price-to-Sales         $4.49 | 2.41 X
        Ratio per NETA share                       0.2637 Price-to-Book              $2.85 | 5.33 X      Price-to-Book          $2.48 | 4.36 X
        Value per NETA share                   $4.39       Price/Earnings             $-0.11 | -- X      Price/Earnings           #VALUE!
        NETA Stub Value                       $10.81       Price/EBITDA            $-1.35 | -11.26 X     Price/EBITDA          $-1.22 | -8.86 X
        Economic/Voting Interest            81% / 81% Enterpr./EBITDA                   -11.19 X         Enterpr./EBITDA           -9.02 X
        NETA Relationship with MCAF                                          Comparables                           CA               SYMC
        Intend to Spin                           No                          Price-to-Sales                      5.34 X             4.11 X
        IRS Tax Free Ruling                       0                          Price-to-Book                       3.71 X             2.55 X
        Record Date / Distr. Date                 0                        0 Price/Earnings                     16.66 X            21.06 X
        MCAF IPO Date /Price                12/1/1999       $         12.00 Price/EBITDA                        72.73 X            13.68 X
        IPO Lockup Expires                  5/29/2000                        Enterpr./EBITDA                    85.32 X             11.5 X
        Shares to Distribute / Float           4.2 X
                                                                                                         Spread Relationship
                                                Implied NETA        NETA         MCAF
                                                                                                         40 Day Average        $           9.07
                             $18.00                                                                      40 Day Variance                   2.31
                             $16.00
                                                                                                         40 Day St. Dev        $           1.52
                                                                                                         40 Day Correlation                0.71
                             $14.00
           Value per share




                             $12.00
                                                                                                        20 Day Average         $         9.55
                             $10.00                                                                     20 Day Variance                  4.47
                              $8.00                                                                     20 Day St. Dev         $         1.93
                              $6.00                                                                     20 Day Correlation               0.57
                              $4.00
                              $2.00                                                                     10 Day Average         $        11.21
                                                                                                        10 Day Variance                  0.70
                              $0.00
                                                                                                        10 Day St. Dev         $         0.94
                               03 /01
                               03 /01
                               04 /01
                               04 /01
                               04 /01
                               04 /01
                               05 /01
                               05 /01
                               05 /01
                               05 /01
                               06 /01
                               06 /01
                               06 /01
                               06 /01
                               07 /01
                               07 /01
                               07 /01
                               07 /01
                               08 /01
                                       01




                                                                                                        10 Day Correlation              (0.71)
                                    1/
                                    6
                                    3
                                    0
                                    6
                                    6
                                    3
                                    0
                                    7
                                    4
                                    1
                                    9
                                    5
                                    2
                                    9
                                    6
                                    3
                                    1
                                    8
                                    5
                                 /1
                                 /2
                                 /3
                                 /0
                                 /1
                                 /2
                                 /3
                                 /0
                                 /1
                                 /2
                                 /2
                                 /0
                                 /1
                                 /1
                                 /2
                                 /0
                                 /1
                                 /1
                                 /2
                                 /0
                             03




        Network Associates, Inc. supplies security and availability solutions for e-business. The company's products focus on network
        security and network management. Network Associates products are marketed under the McAfee and Sniffer names.

        McAfee.com Corporation provides personal computer management solutions. The company's Web site allows consumers to secure,
        repair, update, and upgrade their personal computers (PCs) online. McAfee's applications allow consumers to check PCs for viruses,
        eliminate viruses, repair PCs, and check for Year 2000 compliance.
50                                                                                                                                              Spin-Off Research



                                                                  Valuation Snapshot
                                                     RELIANT ENERGY / RELIANT RES INC
RELIANT ENERGY (REI)                              713-207-3000 RELIANT RES INC (RRI)                                                                      713-207-3000
Current Price                 $        31.20                     Current Price | 01-EPS est.                                      $              21.77 $1.3 | 16.75 X
Shares Out (000)                     289,806                     Shares Out / Float                                                            299,800
Market Cap (000)              $ 9,041,947                        Market Cap (000)                                                  $         6,526,646
Enterprise Value (000)        $ 20,580,167                       Enterprise Value                                                  $         8,102,896
Sales 12 Month Trailing (000) $ 38,410,740                       TTM Sales | Price / Sales                                         $        19,791,920       0.33 X
Book Per Share                $        19.50                     Book Value | Price / Book                                         $               7.78       2.8 X
Insider / Inst. Held               13 %             53 %         Insider / Inst. Held                                                      82 %                3%
Short Int. / Ratio                    2.5731            1.0700 Short Int. / Ratio                                                               1.2942           0.8100
52 Week Range                 $26.98 - $50.45                    52 Week Range                                                        $17.2 - $37.5
REI ownership of RRI                          With RRI | multiple                                                                 Without RRI per share | multiple
Shares owned (000)                   238,574 Price-to-Sales            $132.54 | 0.24 X                                           Price-to-Sales        $64.25 | 0.21 X
Ratio per REI share                   0.8232 Price-to-Book                $19.5 | 1.6 X                                           Price-to-Book          $11.4 | 1.16 X
Value per REI share               $17.92      Price/Earnings            $3.235 | 9.64 X                                           Price/Earnings         $2.16 | 6.15 X
REI Stub Value                    $13.28      Price/EBITDA               $10.06 | 3.1 X                                           Price/EBITDA           $7.89 | 1.68 X
Economic/Voting Interest        80% / 80% Enterpr./EBITDA                    7.06 X                                               Enterpr./EBITDA            6.04 X
REI Relationship with RRI                                        Comparables                                                               XEL                AEP
Intend to Spin                      Yes                          Price-to-Sales                                                           0.76 X             0.56 X
IRS Tax Free Ruling              Pending                         Price-to-Book                                                            1.59 X             1.82 X
Record Date / Distr. Date            0                0          Price/Earnings                                                          12.11 X            12.69 X
RRI IPO Date /Price             4/30/2001      $         30.00 Price/EBITDA                                                               3.81 X             3.81 X
IPO Lockup Expires              10/27/2001                       Enterpr./EBITDA                                                          8.55 X             7.66 X
Shares to Distribute / Float       3.9 X
                                                                 Implied REI          REI         RRI
                                                                                                                                  Spread Relationship
                                                                                                                                  40 Day Average      $         11.37
                   $60.00
                                                                                                                                  40 Day Variance                2.58
                                                                                                                                  40 Day St. Dev      $          1.61
                   $50.00
                                                                                                                                  40 Day Correlation             0.78
 Value per share




                   $40.00
                                                                                                                                  20 Day Average       $        11.76
                   $30.00
                                                                                                                                  20 Day Variance                1.48
                                                                                                                                  20 Day St. Dev       $         1.52
                   $20.00
                                                                                                                                  20 Day Correlation             0.55

                   $10.00                                                                                                         10 Day Average       $        13.00
                                                                                                                                  10 Day Variance                0.34
                    $0.00                                                                                                         10 Day St. Dev       $         0.39
                                                                                                                                  10 Day Correlation             0.88
                         00




                                    00




                                               00




                                                          00




                                                                     00




                                                                                 00




                                                                                            00




                                                                                                       00




                                                                                                                  00




                                                                                                                             00
                       1/




                                  1/




                                             1/




                                                        1/




                                                                   0/




                                                                               0/




                                                                                          1/




                                                                                                     1/




                                                                                                                1/




                                                                                                                           1/
                     /0




                                /1




                                           /2




                                                      /3




                                                                 /1




                                                                             /2




                                                                                        /0




                                                                                                   /1




                                                                                                              /2




                                                                                                                         /3
                   01




                              01




                                         01




                                                    01




                                                               02




                                                                           02




                                                                                      03




                                                                                                 03




                                                                                                            03




                                                                                                                       03




Reliant Energy, Inc. is an international energy services company. The company's retail group consists of three natural gas utilities
and one electric utility, as well as a retail marketing group which provides unregulated retail energy products and services. Reliant's
wholesale group invests in power generation projects and provides wholesale trading and marketing services.

Reliant Resources, Inc. provides electricity and energy services, focusing on the electric power industry in the United States and
Europe. The company acquires, develops, and operates electric power generation facilities that are not subject to traditional cost-
based regulation. Reliant also trades and markets power, natural gas, and other energy-related commodities.
Spin-Off Research                                                                                                                        51



                                                   Valuation Snapshot
                                       SEA CONTAINERS-A / ORIENT EXPRESS HOTELS
        SEA CONTAINERS-A (SCR/A)                            212-302-5066 ORIENT EXPRESS HOTELS (OEH)                         441-295-2244
        Current Price                 $        18.21                      Current Price | 01-EPS est. $              20.50 $1.57 | 13.04 X
        Shares Out (000)                      19,010                      Shares Out / Float                        28,441
        Market Cap (000)              $      346,172                      Market Cap (000)             $           583,032
        Enterprise Value (000)        $ 2,071,052                         Enterprise Value             $           855,282
        Sales 12 Month Trailing (000) $ 1,374,110                         TTM Sales | Price / Sales    $           276,400      2.11 X
        Book Per Share                $        26.84                      Book Value | Price / Book    $             12.26      1.67 X
        Insider / Inst. Held               33 %                64 %       Insider / Inst. Held                 84 %              35 %
        Short Int. / Ratio                    0.8377             18.6000 Short Int. / Ratio                         2.4724         90.4400
        52 Week Range                 $13.66 - $29.69                     52 Week Range                   $16 - $26.25
        SCR/A ownership of OEH                          With OEH | multiple                           Without OEH per share | multiple
        Shares owned (000)                    16,941    Price-to-Sales           $72.28 | 0.25 X      Price-to-Sales        $57.74 | 0 X
        Ratio per SCR/A share                 0.8912    Price-to-Book            $26.84 | 0.68 X      Price-to-Book        $6.24 | -0.01 X
        Value per SCR/A share             $18.27        Price/Earnings           $0.77 | 23.65 X      Price/Earnings         $-0.63 | -- X
        SCR/A Stub Value                  $-0.06        Price/EBITDA             $16.01 | 1.14 X      Price/EBITDA          $12.06 | 0 X
        Economic/Voting Interest        60% / 60%       Enterpr./EBITDA                6.8 X          Enterpr./EBITDA           6.33 X
        SCR/A Relationship with OEH                                       Comparables                        2603 TT           NOL SP
        Intend to Spin                      Yes                           Price-to-Sales                      0.45 X            0.29 X
        IRS Tax Free Ruling              Opinion                          Price-to-Book                       0.78 X            1.44 X
        Record Date / Distr. Date            0                   0        Price/Earnings                     11.47 X            7.01 X
        OEH IPO Date /Price              8/9/2000        $         19.00 Price/EBITDA                         2.69 X            2.34 X
        IPO Lockup Expires               2/5/2001                         Enterpr./EBITDA                     7.82 X            5.03 X
        Shares to Distribute / Float       1.5 X
                                                                                                        Spread Relationship
                                              Implied SCR/A       SCR/A        OEH
                                                                                                        40 Day Average      $            (0.62)
                             $25.00                                                                     40 Day Variance                   0.43
                                                                                                        40 Day St. Dev      $             0.66
                             $20.00                                                                     40 Day Correlation                0.43
           Value per share




                             $15.00
                                                                                                        20 Day Average         $         (0.03)
                             $10.00                                                                     20 Day Variance                   0.16
                                                                                                        20 Day St. Dev         $          0.30
                              $5.00                                                                     20 Day Correlation                0.75

                              $0.00                                                                     10 Day Average         $          0.04
                                                                                                        10 Day Variance                   0.11
                             ($5.00)
                                                                                                        10 Day St. Dev         $          0.36
                               03 /01
                               03 /01
                               04 /01
                               04 /01
                               04 /01
                               04 /01
                               05 /01
                               05 /01
                               05 /01
                               05 /01
                               06 /01
                               06 /01
                               06 /01
                               06 /01
                               07 /01
                               07 /01
                               07 /01
                               07 /01
                               08 /01
                                       01




                                                                                                        10 Day Correlation               (0.23)
                                    1/
                                    6
                                    3
                                    0
                                    6
                                    6
                                    3
                                    0
                                    7
                                    4
                                    1
                                    9
                                    5
                                    2
                                    9
                                    6
                                    3
                                    1
                                    8
                                    5
                                 /1
                                 /2
                                 /3
                                 /0
                                 /1
                                 /2
                                 /3
                                 /0
                                 /1
                                 /2
                                 /2
                                 /0
                                 /1
                                 /1
                                 /2
                                 /0
                                 /1
                                 /1
                                 /2
                                 /0
                             03




        Sea Containers Limited leases and sells cargo containers to liner ship operators worldwide and operates ferry and rail services. The
        company is also involved in the ownership and management of luxury hotels and resort properties, restaurants located in New York
        City and London, tourist trains, and a river cruiseship.

        Orient-Express Hotel Ltd. owns and operates luxury hotels, tourist trains, a river cruise ship, and restaurants. The company's
        properties include Hotel Cipriani in Venice, Italy, Reid's Palace in Madeira, Portugal, Copacabana Palace in Rio de Janeiro, Brazil,
        and the 21 Club in New York City, in the United States.
52                                                                                                             Spin-Off Research



                                          Valuation Snapshot
                                        SPX CORP / INRANGE TECH-B
SPX CORP (SPW)                                       231-724-5000 INRANGE TECH-B (INRG)                                 609-518-4000
Current Price                    $      126.70                     Current Price | 01-EPS est.   $              10.85 $0.2 | 54.25 X
Shares Out (000)                        39,652                     Shares Out / Float                          83,333
Market Cap (000)                 $ 5,023,908                       Market Cap (000)               $           904,163
Enterprise Value (000)           $ 6,415,308                       Enterprise Value               $           885,563
Sales 12 Month Trailing (000)    $ 2,731,500                       TTM Sales | Price / Sales      $           251,370      3.59 X
Book Per Share                   $       21.74                     Book Value | Price / Book      $               2.75     3.95 X
Insider / Inst. Held                 22 %               77 %       Insider / Inst. Held                   90 %              83 %
Short Int. / Ratio                      2.6085             8.1200 Short Int. / Ratio                           1.8682           7.8700
52 Week Range                    $84.99 - $186                     52 Week Range                     $6.75 - $65.63
SPW ownership of INRG                            With INRG | multiple                            Without INRG per share | multiple
Shares owned (000)                        75,633 Price-to-Sales           $68.89 | 1.84 X        Price-to-Sales        $62.55 | 1.69 X
Ratio per SPW share                       1.9074 Price-to-Book            $21.74 | 5.83 X        Price-to-Book         $10.84 | 9.78 X
Value per SPW share                    $20.7     Price/Earnings           $6.51 | 19.46 X        Price/Earnings        $6.13 | 17.29 X
SPW Stub Value                          $106     Price/EBITDA            $12.16 | 10.42 X        Price/EBITDA           $11 | 9.64 X
Economic/Voting Interest             91% / 91% Enterpr./EBITDA                13.31 X            Enterpr./EBITDA          12.87 X
SPW Relationship with INRG                                         Comparables                            UTX               EMR
Intend to Spin                           No                        Price-to-Sales                        1.28 X             1.5 X
IRS Tax Free Ruling                      0                         Price-to-Book                         4.23 X            3.58 X
Record Date / Distr. Date              1/0/00          1/0/00      Price/Earnings                       17.86 X           17.85 X
INRG IPO Date /Price                 9/21/2000    $         16.00 Price/EBITDA                           8.86 X            7.28 X
IPO Lockup Expires                   3/21/2001                     Enterpr./EBITDA                        10 X             8.57 X
Shares to Distribute / Float           9.8 X
                                                                                                 Spread Relationship
                                         Implied SPW       SPW         INRG
                                                                                                 40 Day Average      $         94.44
                       $140.00                                                                   40 Day Variance               25.11
                                                                                                 40 Day St. Dev      $          5.01
                       $120.00                                                                   40 Day Correlation            (0.01)
     Value per share




                       $100.00
                                                                                                 20 Day Average       $        96.64
                        $80.00
                                                                                                 20 Day Variance                9.58
                        $60.00                                                                   20 Day St. Dev       $         5.14
                                                                                                 20 Day Correlation            (0.06)
                        $40.00

                        $20.00                                                                   10 Day Average       $       100.78
                                                                                                 10 Day Variance               12.39
                         $0.00
                                                                                                 10 Day St. Dev       $         3.56
                          03 /01
                          03 /01
                          04 /01
                          04 /01
                          04 /01
                          04 /01
                          05 /01
                          05 /01
                          05 /01
                          05 /01
                          06 /01
                          06 /01
                          06 /01
                          06 /01
                          07 /01
                          07 /01
                          07 /01
                          07 /01
                          08 /01
                                  01




                                                                                                 10 Day Correlation             0.08
                               1/
                               6
                               3
                               0
                               6
                               6
                               3
                               0
                               7
                               4
                               1
                               9
                               5
                               2
                               9
                               6
                               3
                               1
                               8
                               5
                            /1
                            /2
                            /3
                            /0
                            /1
                            /2
                            /3
                            /0
                            /1
                            /2
                            /2
                            /0
                            /1
                            /1
                            /2
                            /0
                            /1
                            /1
                            /2
                            /0
                        03




SPX Corporation is a global provider of technical products and systems, industrial products and services, service solutions, and
vehicle components. The company designs, manufactures, and markets data networking equipment, fire detection equipment, power
transformers, TV and radio broadcast equipment, and a variety of specialty tools, equipment, and services.

Inrange Technologies Corporation designs, manufactures, markets, and services switching and networking products for storage,
data, and telecommunications networks. The company's products are compatible with various vendors' products and multiple
communication standards and protocols. Inrange serves Fortune 1000 businesses and other enterprises that operate large-scale
systems.
Spin-Off Research                                                                                                                         53



                                                     Valuation Snapshot
                                        TITAN CORP / SUREBEAM CORP -A
        TITAN CORP (TTN)                                       858-552-9500 SUREBEAM CORP -A (SURE)                                858-552-9500
        Current Price                   $        18.89                       Current Price | 01-EPS est. $               11.51      #VALUE!
        Shares Out (000)                       61,108                        Shares Out / Float                         55,700
        Market Cap (000)                $ 1,154,328                          Market Cap (000)             $           641,107
        Enterprise Value (000)          $ 1,660,308                          Enterprise Value             $           699,177
        Sales 12 Month Trailing (000)   $ 1,073,110                          TTM Sales | Price / Sales    $             29,450       21.72 X
        Book Per Share                  $         3.74                       Book Value | Price / Book    $               (0.32)        -- X
        Insider / Inst. Held                17 %                 57 %        Insider / Inst. Held                 88 %                 33 %
        Short Int. / Ratio                     4.9584              15.6300 Short Int. / Ratio                           3.1737            15.3900
        52 Week Range                   $11.13 - $31.5                       52 Week Range                   $6.92 - $19.45
        TTN ownership of SURE                              With SURE | multiple                          Without SURE per share | multiple
        Shares owned (000)                        46,500 Price-to-Sales             $17.56 | 1.08 X      Price-to-Sales          $17.08 | 0.59 X
        Ratio per TTN share                       0.7609 Price-to-Book               $3.74 | 5.05 X      Price-to-Book            $3.51 | 2.89 X
        Value per TTN share                   $8.76        Price/Earnings           $0.33 | 57.24 X      Price/Earnings             #VALUE!
        TTN Stub Value                        $10.13       Price/EBITDA             $0.96 | 19.68 X      Price/EBITDA             $0.9 | 11.26 X
        Economic/Voting Interest            83% / 83% Enterpr./EBITDA                    28.4 X          Enterpr./EBITDA              19.5 X
        TTN Relationship with SURE                                           Comparables                          CSC                 CACI
        Intend to Spin                          Yes                          Price-to-Sales                       0.6 X              0.85 X
        IRS Tax Free Ruling                  Pending                         Price-to-Book                       1.97 X              3.03 X
        Record Date / Distr. Date                0                         0 Price/Earnings                     19.67 X              22.59 X
        SURE IPO Date /Price                3/15/2001       $         10.00 Price/EBITDA                         4.88 X               9.32 X
        IPO Lockup Expires                  9/11/2001                        Enterpr./EBITDA                     6.57 X               10.2 X
        Shares to Distribute / Float           5.1 X
                                                                                                         Spread Relationship
                                                 Implied TTN        TTN        SURE
                                                                                                         40 Day Average          $           9.35
                           $30.00                                                                        40 Day Variance                     0.78
                                                                                                         40 Day St. Dev          $           0.88
                           $25.00
                                                                                                         40 Day Correlation                  0.72
         Value per share




                           $20.00
                                                                                                          20 Day Average        $          9.57
                           $15.00                                                                         20 Day Variance                  0.43
                                                                                                          20 Day St. Dev        $          0.80
                           $10.00                                                                         20 Day Correlation               0.58

                            $5.00
                                                                                                          10 Day Average        $          9.94
                            $0.00
                                                                                                          10 Day Variance                  0.44
                                                                                                          10 Day St. Dev        $          0.62
                             03 /01

                             03 /01

                             04 /01

                             04 /01

                             04 /01

                             04 /01

                             05 /01

                             05 /01

                             05 /01

                             05 /01

                             06 /01

                             06 /01

                             06 /01

                             06 /01

                             07 /01

                             07 /01

                             07 /01

                             07 /01

                             08 /01
                                     01




                                                                                                          10 Day Correlation               0.58
                                  1/
                                  6

                                  3

                                  0

                                  6

                                  6

                                  3

                                  0

                                  7

                                  4

                                  1

                                  9

                                  5

                                  2

                                  9

                                  6

                                  3

                                  1

                                  8

                                  5
                               /1

                               /2

                               /3

                               /0

                               /1

                               /2

                               /3

                               /0

                               /1

                               /2

                               /2

                               /0

                               /1

                               /1

                               /2

                               /0

                               /1

                               /1

                               /2

                               /0
                           03




        The Titan Corporation creates, builds, and launches technology-based businesses offering technical solutions. Titan provides
        information technology, communications and electron beam food pasteurization and medical product sterilization systems and
        services. Three of Titan's five segments develop and deploy communications and information technology solutions and services.

        SureBeam Corporation provides patented and proprietary electronic pasteurization systems and services for the food industry. The
        company's systems are sold to food growers, packers, processors, and retailers.
54                                                                                                            Spin-Off Research



                                           Valuation Snapshot
                                      TYCO INTL LTD / TYCOM LTD
TYCO INTL LTD (TYC)                               441-292-8674 TYCOM LTD (TCM)                                        441-298-9770
Current Price                 $        53.69                    Current Price | 01-EPS est.     $             11.75 $0.7 | 16.69 X
Shares Out (000)                   1,834,100                    Shares Out / Float                          506,160
Market Cap (000)              $ 98,472,829                      Market Cap (000)                $         5,947,375
Enterprise Value (000)        $ 152,525,929                     Enterprise Value                $         6,399,075
Sales 12 Month Trailing (000) $ 33,948,500                      TTM Sales | Price / Sales       $         2,353,200       2.53 X
Book Per Share                $        17.25                    Book Value | Price / Book       $               4.21      2.79 X
Insider / Inst. Held               14 %             74 %        Insider / Inst. Held                    89 %               11 %
Short Int. / Ratio                   39.4248            4.7300 Short Int. / Ratio                            8.1148          10.8200
52 Week Range                 $40.15 - $63.21                   52 Week Range                      $9.45 - $46.25
TYC ownership of TCM                          With TCM | multiple                              Without TCM per share | multiple
Shares owned (000)                   450,000 Price-to-Sales             $18.51 | 2.9 X         Price-to-Sales        $17.23 | 2.95 X
Ratio per TYC share                   0.2454 Price-to-Book             $17.25 | 3.11 X         Price-to-Book         $15.81 | 3.21 X
Value per TYC share                $2.88      Price/Earnings           $2.78 | 19.31 X         Price/Earnings        $2.61 | 19.47 X
TYC Stub Value                    $50.81      Price/EBITDA                 #VALUE!             Price/EBITDA             #VALUE!
Economic/Voting Interest        89% / 89% Enterpr./EBITDA                  #VALUE!             Enterpr./EBITDA          #VALUE!
TYC Relationship with TCM                                       Comparables                              GE                ETN
Intend to Spin                      No                          Price-to-Sales                         3.19 X             0.67 X
IRS Tax Free Ruling                  0                          Price-to-Book                          7.89 X            2.12 X
Record Date / Distr. Date         1/0/00            1/0/00      Price/Earnings                        28.24 X            18.85 X
TCM IPO Date /Price             7/26/2000      $         32.00 Price/EBITDA                           15.19 X             5.62 X
IPO Lockup Expires              1/22/2001                       Enterpr./EBITDA                       19.01 X             8.25 X
Shares to Distribute / Float        8X
                                                                                               Spread Relationship
                                       Implied TYC       TYC        TCM
                                                                                               40 Day Average      $           49.69
                       $70.00                                                                  40 Day Variance                  1.55
                                                                                               40 Day St. Dev      $            1.24
                       $60.00                                                                  40 Day Correlation               0.60
     Value per share




                       $50.00
                                                                                               20 Day Average        $         48.93
                       $40.00
                                                                                               20 Day Variance                  1.14
                       $30.00                                                                  20 Day St. Dev        $          1.09
                                                                                               20 Day Correlation              (0.01)
                       $20.00

                       $10.00                                                                  10 Day Average        $         49.44
                                                                                               10 Day Variance                  0.39
                        $0.00
                                                                                               10 Day St. Dev        $          0.78
                         03 /01
                         03 /01
                         04 /01
                         04 /01
                         04 /01
                         04 /01
                         05 /01
                         05 /01
                         05 /01
                         05 /01
                         06 /01
                         06 /01
                         06 /01
                         06 /01
                         07 /01
                         07 /01
                         07 /01
                         07 /01
                         08 /01
                                 01




                                                                                               10 Day Correlation              (0.33)
                              1/
                              6
                              3
                              0
                              6
                              6
                              3
                              0
                              7
                              4
                              1
                              9
                              5
                              2
                              9
                              6
                              3
                              1
                              8
                              5
                           /1
                           /2
                           /3
                           /0
                           /1
                           /2
                           /3
                           /0
                           /1
                           /2
                           /2
                           /0
                           /1
                           /1
                           /2
                           /0
                           /1
                           /1
                           /2
                           /0
                       03




Tyco International Ltd. is a diversified manufacturing and service company with operations around the world. The company
manufactures, services, and installs electrical and electronic components, undersea telecommunications systems, and fire protection
and security systems. The company also manufactures flow control valves, healthcare and specialty products, and plastics.

TyCom is a provider of undersea fiber optic networks and services. The company plans to design, operate and sell bandwidth
capacity on a global undersea fiber optic network, called the TyCom Global Network, which the company believes will be the largest
and most technologically advanced network in the world. TyCom will provide bandwidth solutions to telecommunications providers,
Internet and application service providers, and to other customers who require significant bandwidth capacity. Ultimately, the
company plans on transforming itself into a provider of undersea bandwidth services and on delivering customer-driven network
solutions.
Spin-Off Research                                                                                                                                                                       55



                                                               Valuation Snapshot
                                                                           UTILICORP UNITED / AQUILA INC
        UTILICORP UNITED (UCU)                            816-421-6600 AQUILA INC (ILA)                                                                                          816-527-1000
        Current Price                 $        31.39                      Current Price | 01-EPS est.                                                    $              27.30 $1.23 | 22.2 X
        Shares Out (000)                     113,622                      Shares Out / Float                                                                          100,025
        Market Cap (000)              $ 3,566,595                         Market Cap (000)                                                                $         2,730,683
        Enterprise Value (000)        $ 6,141,895                         Enterprise Value                                                                $         2,675,883
        Sales 12 Month Trailing (000) $ 36,205,200                        TTM Sales | Price / Sales                                                       $        26,478,000        0.1 X
        Book Per Share                $        19.34                      Book Value | Price / Book                                                       $              2.50      10.92 X
        Insider / Inst. Held                6%              43 %          Insider / Inst. Held                                                                    84 %               24 %
        Short Int. / Ratio                    5.2576            8.3700 Short Int. / Ratio                                                                              3.8593            6.9900
        52 Week Range                 $22.63 - $37.85                     52 Week Range                                                                        $22 - $35
        UCU ownership of ILA                          With ILA | multiple                                                                                Without ILA per share | multiple
        Shares owned (000)                    77,520 Price-to-Sales              $318.65 | 0.1 X                                                         Price-to-Sales        $85.61 | 0.15 X
        Ratio per UCU share                   0.6823 Price-to-Book               $19.34 | 1.62 X                                                         Price-to-Book         $17.01 | 0.75 X
        Value per UCU share               $18.63      Price/Earnings            $2.544 | 12.34 X                                                         Price/Earnings          $1.7 | 7.51 X
        UCU Stub Value                    $12.76      Price/EBITDA                 $5.7 | 5.51 X                                                         Price/EBITDA           $3.96 | 3.22 X
        Economic/Voting Interest        78% / 78% Enterpr./EBITDA                     9.48 X                                                             Enterpr./EBITDA            9.08 X
        UCU Relationship with ILA                                         Comparables                                                                             XEL                AEP
        Intend to Spin                      Yes                           Price-to-Sales                                                                         0.76 X             0.56 X
        IRS Tax Free Ruling               Pending                         Price-to-Book                                                                          1.59 X             1.82 X
        Record Date / Distr. Date            0                0           Price/Earnings                                                                        12.11 X            12.69 X
        ILA IPO Date /Price              4/23/2001    $          24.00 Price/EBITDA                                                                              3.81 X             3.81 X
        IPO Lockup Expires              10/20/2001                        Enterpr./EBITDA                                                                        8.55 X             7.66 X
        Shares to Distribute / Float       3.4 X
                                                                          Series1 Implied UCU
                                                                                            Series2     UCU Series3    ILA       Series4
                                                                                                                                                         Spread Relationship
                                                                                                                                                         40 Day Average        $        13.49
                        $40.00
                          $1.00                                                                                                                          40 Day Variance                 0.35
                          $0.90
                        $35.00                                                                                                                           40 Day St. Dev        $         0.59
                          $0.80
                                                                                                                                                         40 Day Correlation              0.89
                        $30.00
            Value per share




                               $0.70
                        $25.00                                                                                                                           20 Day Average        $        13.13
         Value per share




                        $20.00
                               $0.60                                                                                                                     20 Day Variance                 0.76
                               $0.50
                                                                                                                                                         20 Day St. Dev        $         0.52
                        $15.00
                                                                                                                                                         20 Day Correlation              0.81
                               $0.40
                        $10.00
                               $0.30                                                                                                                     10 Day Average        $        12.82
                              $5.00
                               $0.20                                                                                                                     10 Day Variance                 0.40
                              $0.00                                                                                                                      10 Day St. Dev        $         0.27
                               $0.10
                                                                                                                                                         10 Day Correlation              0.91
                                    01




                                               01




                                                          01




                                                                     01




                                                                                      01




                                                                                                   01




                                                                                                               01




                                                                                                                            01




                                                                                                                                         01




                                                                                                                                                    01
                                   6/




                                              0/




                                                         6/




                                                                    0/




                                                                                    4/




                                                                                                 9/




                                                                                                             2/




                                                                                                                           6/




                                                                                                                                        1/




                                                                                                                                                   5/
                               /1




                                          /3




                                                     /1




                                                                /3




                                                                                 /1




                                                                                              /2




                                                                                                          /1




                                                                                                                       /2




                                                                                                                                    /1




                                                                                                                                               /2




                               $0.00
                              03




                                         03




                                                    04




                                                               04




                                                                               05




                                                                                            05




                                                                                                        06




                                                                                                                      06




                                                                                                                                   07




                                                                                                                                              07




                                         001
                                          1
                                         10
                                         12
                                         13
                                         14
                                         15
                                         16
                                         17
                                         18
                                         19
                                         20
                                         21
                                         22
                                         23
                                         24
                                         25
                                         26
                                         27
                                         28
                                         29
                                         30
                                         31
                                         32
                                         33
                                         34
                                         35
                                         36
                                         37
                                         38
                                         39
                                         40
                                         41
                                         42
                                         43
                                         44
                                         45
                                         46
                                         47
                                         48
                                         49
                                         50
                                         51
                                         52
                                         53
                                         54
                                         55
                                         56
                                         57
                                         58
                                         59
                                         60
                                         61
                                         62
                                         63
                                         64
                                         65
                                         66
                                         67
                                         68
                                         69
                                         70
                                         71
                                         72
                                         73
                                         74
                                         75
                                         76
                                         77
                                         78
                                         79
                                         80
                                         81
                                         82
                                         83
                                         84
                                         85
                                         86
                                         87
                                         88
                                         89
                                         90
                                         91
                                         92
                                         93
                                         94
                                         95
                                         96
                                         97
                                        198
                                        109
                                          1
                                          2
                                          3
                                          4
                                          5
                                          6
                                          7
                                          8
                                         19




                                         9




        UtiliCorp United Inc. is a multinational energy solutions provider. The company's network segment includes network generation,
        distribution and transmission businesses, as well as appliance repair. The energy merchant segment includes energy marketing and
        trading businesses, natural gas gathering, processing and transportation, and independent power projects.

        Aquila, Inc., is a wholesale energy merchant whose activities include electric generation, natural gas gathering and processing,
        natural gas storage, and coal blending and storage. The company markets and trades commodities such as natural gas, electricity,
        coal, bandwidth capacity, and emissions allowances. Aquila also offers risk management products and services.
56                                                                                                            Spin-Off Research



                                                       Valuation Snapshot
                                XCEL ENERGY INC / NRG ENERGY INC
XCEL ENERGY INC (XEL)                             612-330-5500 NRG ENERGY INC (NRG)                                   612-373-5300
Current Price                 $         27.24                   Current Price | 01-EPS est.     $             19.75 $1.36 | 14.55 X
Shares Out (000)                      343,195                   Shares Out / Float                          175,775
Market Cap (000)              $ 9,348,621                       Market Cap (000)                $         3,471,556
Enterprise Value (000)        $ 20,981,431                      Enterprise Value                $        10,784,946
Sales 12 Month Trailing (000) $ 12,317,540                      TTM Sales | Price / Sales       $         2,449,510      1.42 X
Book Per Share                $         17.10                   Book Value | Price / Book       $             10.32      1.91 X
Insider / Inst. Held                 1%              43 %       Insider / Inst. Held                    75 %             102 %
Short Int. / Ratio                     2.8389           3.0900 Short Int. / Ratio                            4.1460          3.1900
52 Week Range                 $24.06 - $31.85                   52 Week Range                      $17.65 - $37.7
XEL ownership of NRG                          With NRG | multiple                              Without NRG per share | multiple
Shares owned (000)                    147,605 Price-to-Sales           $35.89 | 0.76 X         Price-to-Sales       $28.75 | 0.65 X
Ratio per XEL share                    0.4301 Price-to-Book             $17.1 | 1.59 X         Price-to-Book         $11.1 | 1.69 X
Value per XEL share                $8.49      Price/Earnings           $2.25 | 12.12 X         Price/Earnings       $1.66 | 11.3 X
XEL Stub Value                     $18.75     Price/EBITDA              $7.14 | 3.82 X         Price/EBITDA            #VALUE!
Economic/Voting Interest        84% / 84% Enterpr./EBITDA                   8.56 X             Enterpr./EBITDA         #VALUE!
XEL Relationship with NRG                                       Comparables                             AEP                SO
Intend to Spin                       No                         Price-to-Sales                         0.56 X            1.58 X
IRS Tax Free Ruling                   0                         Price-to-Book                          1.82 X           1.53 X
Record Date / Distr. Date             0                       0 Price/Earnings                         12.7 X           14.54 X
NRG IPO Date /Price              5/30/2000     $         15.00 Price/EBITDA                            3.81 X            4.37 X
IPO Lockup Expires              11/26/2000                      Enterpr./EBITDA                        7.67 X            7.73 X
Shares to Distribute / Float        5.2 X
                                         Implied XEL    XEL      NRG
                                                                                               Spread Relationship
                                                                                               40 Day Average      $           18.29
                       $40.00                                                                  40 Day Variance                  0.19
                       $35.00                                                                  40 Day St. Dev      $            0.44
                                                                                               40 Day Correlation               0.90
                       $30.00
     Value per share




                       $25.00                                                                  20 Day Average         $        18.08
                                                                                               20 Day Variance                  1.12
                       $20.00
                                                                                               20 Day St. Dev         $         0.38
                       $15.00                                                                  20 Day Correlation               0.93
                       $10.00
                                                                                               10 Day Average         $        18.15
                        $5.00
                                                                                               10 Day Variance                  0.29
                         $-                                                                    10 Day St. Dev         $         0.44
                                                                                               10 Day Correlation               0.57
                        03 01

                        03 01

                        04 01

                        04 01

                        04 01

                        04 01

                        04 01

                        05 01

                        05 01

                        05 01

                        05 01

                        05 01

                        05 01

                        06 01

                        06 01

                        06 01

                        06 01

                        06 01

                        07 01

                        07 01

                        07 01

                        07 01

                        07 01

                        08 01
                              01
                            6/

                            2/

                            8/

                            3/

                            9/

                            6/

                            0/

                            6/

                            2/

                            8/

                            4/

                            8/

                            4/

                            1/

                            6/

                            2/

                            8/

                            2/

                            8/

                            5/

                            1/

                            7/

                            3/

                            7/

                            2/
                          /1

                          /2

                          /2

                          /0

                          /0

                          /1

                          /2

                          /2

                          /0

                          /0

                          /1

                          /1

                          /2

                          /3

                          /0

                          /1

                          /1

                          /2

                          /2

                          /0

                          /1

                          /1

                          /2

                          /2

                          /0
                        03




Xcel Energy, Inc. provides electric and natural gas services. The company offers a variety of energy-related services, including
generation, transmission, and distribution of electricity and natural gas throughout the United States.

NRG Energy, Inc., a global energy company, acquires, develops, constructs, owns, and operates power generation facilities. The
company's operations utilize such diverse fuel sources as natural gas, oil, coal, and refuse derived fuel.
                                                                                                                                                                                                                                                                             In te n d       E c o n o m ic       Em bedded           R e s id u a l
P a re n t C o m p a n y                                             S ym b ol                          P ric e                C a rv e -O u t / H o ld in g                                        S ym b ol                         P ric e        R a tio (1 )         T o S p in (2 )   % O w n e d (3 )        V a lu e         S tu b V a lu e
A D V L IG H T IN G T E C                                           ADLT                           $        3 .2 5             F IB E R S T A R S IN C                                             FBST                          $        4 .4 4       0 .0 4 4 3                              2 3 .9 7 %         $        0 .2 0   $          3 .0 5
A L P IN E G R O U P IN C                                           AGI                            $        1 .4 0             S U P E R IO R T E L E C O M                                        SUT                           $        2 .1 9       0 .7 5 6 8                                    5 0 .8 1 %   $        1 .6 6   $         (0 .2 6 )
AMER HOME PRODS                                                     AHP                            $      5 9 .7 5             IM M U N E X C O R P                                                IM N X                        $      1 4 .5 3       0 .1 6 9 9                                    4 1 .2 0 %   $        2 .4 7   $        5 7 .2 8
M O T IE N T C O R P                                                MTNT                           $        0 .6 3             X M S A T E L L IT E -A                                             XM SR                         $      1 4 .1 5       0 .0 1 7 2                                      1 .9 2 %   $        0 .2 4   $          0 .3 9
A M E R B IL T R IT E                                               ABL                            $      1 3 .4 5             C O N G O LEU M C O R P                                             CGM                           $        2 .4 7       0 .0 4 3 8                                      4 .1 4 %   $        0 .1 1   $        1 3 .3 4
A M E R IN T L G R O U P                                            A IG                           $      8 2 .1 4             2 1 S T C E N T U R Y IN S                                          TW                            $      1 8 .9 5       0 .0 2 2 9                                    6 2 .7 3 %   $        0 .4 3   $        8 1 .7 1
                                                                                                                               T R A N S A T L A N T IC H L                                        TRH                           $      7 5 .9 9       0 .0 1 3 4                                    5 9 .9 3 %   $        1 .0 2   $        8 1 .1 2
                                                                                                                                                                                                                                                                                                                  $        1 .4 5   $        8 0 .6 9
                                                                                                                                                                                                                                                                                                                                                                                   Spin-Off Research




A M E R S O F T W A R E -A                                          AMSW A                         $          1 .6 9           L O G IL IT Y IN C                                                  LG TY                         $        3 .3 7        0 .6 0 4 4                                   8 5 .2 6 %   $        2 .0 4   $         (0 .3 5 )
A P O L L O G R O U P -A                                            APO L                          $        4 3 .9 7           U N IV E R S IT Y O F P H                                           UO PX                         $      3 2 .0 8        0 .4 1 6 0                                   5 9 .3 8 %   $      1 3 .3 5   $        3 0 .6 2
A R C IN T L C O R P                                                ATVLE                          $          0 .0 1           BALLANT YN E O M AH A                                               BTNE                          $        0 .5 7        0 .1 6 8 0                                   2 3 .3 4 %   $        0 .1 0   $         (0 .3 6 )
                                                                                                                               C ABLETEL CO M M                                                    TTV                           $        1 .4 0        0 .1 9 5 5                                   4 8 .1 4 %   $        0 .2 7   $         (0 .0 9 )
                                                                                                                                                                                                                                                                                                                  $        0 .3 7   $         (0 .3 6 )
AT&T CO RP                                                          T                              $        2 0 .5 2           R A IN B O W M E D IA G R                                           RMG                           $      2 6 .1 5        0 .0 0 7 4                                   3 7 .5 7 %   $        0 .1 9   $        1 9 .5 4
                                                                                                                               C A B L E V IS IO N S Y S                                           CVC                           $      5 4 .3 7        0 .0 1 4 5                                   3 6 .7 9 %   $        0 .7 9   $        2 0 .3 3
                                                                                                                                                                                                                                                                                                                  $        0 .9 8   $        1 9 .5 4
E P R E S E N C E IN C                                              EPRE                           $          3 .4 7           S W IT C H B O A R D IN C                                           SW BD                         $     4 .8 0           0 .4 0 9 9                                   3 7 .8 9 %   $        1 .9 7   $          1 .5 0
B A N C O S A N T A N -A D R                                        STD                            $          8 .8 4           SANTANDER BANCO R                                                   SBP                           $ 1 9 .5 2             0 .0 0 7 5                                   8 1 .1 0 %   $        0 .1 5   $          8 .6 9
BAR N ES & NO BLE                                                   BKS                            $        3 8 .2 4           BAR N ESAND N O BLE                                                 BNBN                          $     1 .2 3           0 .8 7 7 4                                   3 9 .0 8 %   $        1 .0 8   $        3 7 .1 6
B O W N E & C O IN C                                                BNE                            $        1 1 .7 5           E D G A R O N L IN E IN C                                           EDGR                          $     3 .1 0           0 .0 3 0 3                                     6 .7 1 %   $        0 .0 9   $        1 1 .6 6
B R O O K T R O U T IN C                                            BRKT                           $          6 .1 1           IN T E R S P E E D IN C                                             IS P D                        $     0 .0 3           0 .5 0 0 8                                   5 6 .0 5 %   $        0 .0 1   $          6 .1 0
C A B L E V IS IO N S Y S                                           CVC                            $        5 4 .3 7           R A IN B O W M E D IA G R                                           RMG                           $ 2 6 .1 5             0 .6 5 8 2                                   6 3 .2 7 %   $      1 7 .2 1   $        3 7 .1 6
C ELL G EN ESYS                                                     CEG E                          $        1 7 .4 2           A B G E N IX IN C                                                   ABG X                         $ 2 8 .2 5             0 .2 6 0 7                                   1 1 .1 8 %   $        7 .3 6   $        1 0 .0 6
CENDANT CO RP                                                       CD                             $        1 9 .7 4           H O M E S T O R E .C O M                                            HOMS                          $ 2 6 .3 0             0 .0 1 6 4                                   1 2 .9 7 %   $        0 .4 3   $        1 9 .3 1
CENTEX CO RP                                                        CTX                            $        4 3 .7 1           CENTEX CO NSTRUCT                                                   CXP                           $ 3 3 .1 7             0 .1 9 8 2                                   6 5 .2 1 %   $        6 .5 7   $        3 7 .1 4
CHEVRO N CO RP                                                      CHV                            $        9 1 .4 7           D Y N E G Y IN C -A                                                 DYN                           $ 4 6 .1 5             0 .1 0 7 9                                   2 8 .9 0 %   $        4 .9 8   $        8 6 .4 9
C IR C U IT C IT Y                                                  CC                             $        1 8 .5 3           CARM AX G RO UP                                                     KMX                           $ 1 7 .6 9             0 .0 9 6 7                                   7 4 .6 0 %   $        1 .7 1   $        1 6 .8 2
C IS C O S Y S T E M S                                              CSCO                           $        1 9 .1 6           T IB C O S O F T W A R E                                            T IB X                        $     9 .2 5           0 .0 0 1 8                                     7 .1 1 %   $        0 .0 2   $        1 9 .1 4
C IT IZ E N S C O M M C O                                           CZN                            $        1 1 .7 2           E L E C L IG H T W A V E                                            E L IX                        $     1 .4 6           0 .1 5 6 2                                   8 1 .5 4 %   $        0 .2 3   $        1 1 .4 9
C H R IS -C R A F T IN D S                                          CCN                            $        6 9 .7 0           B H C C O M M U N IC A T -A                                         BHC                           $ 1 3 3 .9 7           0 .0 6 6 0                                     8 .0 3 %   $        8 .8 4   $        6 0 .8 6
C O C A -C O L A C O                                                KO                             $        4 4 .6 5           C O C A -C O L A B O T T L I                                        CO KE                         $ 3 7 .9 1             0 .0 0 0 8                                   3 1 .0 4 %   $        0 .0 3   $        4 4 .6 2
                                                                                                                               C O C A -C O L A E N T E R                                          CCE                           $ 1 4 .5 5             0 .0 6 7 9                                   3 7 .9 7 %   $        0 .9 9   $        4 3 .6 6
                                                                                                                                                                                                                                                                                                                  $        1 .0 2   $        4 3 .6 3
CO M VERSE TECH                                                     CMVT                           $        2 9 .3 0           U L T IC O M IN C                                                   U LC M                        $      1 9 .7 8        0 .1 6 8 7                                   7 6 .7 8 %   $        3 .3 4   $        2 5 .9 7
C O N STELLAT EN ER                                                 CEG                            $        3 0 .4 0           O R IO N P O W E R H L D G                                          ORN                           $      2 0 .8 5        0 .1 0 6 9                                   2 7 .1 6 %   $        2 .2 3   $        2 8 .1 7
IN T E R A C T IV E D A T A                                         ID C O                         $        1 2 .0 0           M A R K E T W A T C H .C O M                                        MKTW                          $        2 .5 5        0 .0 6 1 8                                   3 6 .0 0 %   $        0 .1 6   $        1 1 .8 4
DTE ENERGY CO                                                       DTE                            $        4 3 .9 0           P L U G P O W E R IN C                                              PLUG                          $      1 3 .7 7        0 .0 8 3 1                                   3 1 .6 4 %   $        1 .1 4   $        4 2 .7 6
D U P O N T (E I)                                                   DD                             $        4 2 .9 6           DUPO NT PHO TO M ASK                                                DPM I                         $      3 7 .6 0        0 .0 0 3 5                                   1 9 .5 5 %   $        0 .1 3   $        4 2 .8 3
                                                                                                                                                                                                                                                                                                                                                          Implied Value of Stubs




E A S T M A N C H E M IC A L                                        EMN                            $        4 3 .4 4           G E N E N C O R IN T L                                              GCOR                          $      1 2 .3 8        0 .3 2 4 3                                   4 3 .9 7 %   $        4 .0 1   $        3 9 .4 3
ECI TELECO M                                                        E C IL                         $          4 .6 6           ECTEL LTD                                                           ECTX                          $      1 3 .0 0        0 .1 3 2 0                                   7 0 .4 9 %   $        1 .7 2   $          2 .9 4
ENRON CORP                                                          ENE                            $        4 4 .5 8           N EW PO W ER HLD G S                                                NPW                           $        5 .5 0        0 .0 1 8 3                                     0 .0 0 %   $        0 .1 0   $        4 4 .4 8
F IR S T A L B A N Y C O M                                          FACT                           $        1 0 .4 1           M E C H A N IC A L T E C H                                          MKTY                          $        6 .1 9        1 .5 0 6 7                                   3 3 .7 2 %   $        9 .3 2   $          1 .0 9
FM C CO RP                                                          FM C                           $        6 3 .7 2           F M C T E C H N O L O G IE S                                        FTI                           $      1 7 .6 0        1 .7 2 5 3                Y                  8 2 .5 9 %   $      3 0 .3 7   $        3 3 .3 5
GEN MOTO RS CORP                                                    GM                             $        6 3 .0 2           H U G H E S E L E C T R O N IC S                                    GMH                           $      1 9 .8 6        0 .7 5 5 1                                   4 7 .3 8 %   $      1 5 .0 0   $        4 8 .0 2
                                                                                                                               PANAM SAT CO RP                                                     SPO T                         $      3 2 .8 0        0 .2 2 0 2                                   8 0 .8 3 %   $        7 .2 2   $        5 5 .8 0
                                                                                                                                                                                                                                                                                                                  $      2 2 .2 2   $        4 0 .8 0
G L O B A L C R O S S IN G                                          GX                             $          6 .1 9           A S IA G L O B A L -A                                               AX                            $        4 .8 5        0 .3 5 6 0                                   5 6 .8 6 %   $        1 .7 3   $          4 .4 6
G LO BAL TELESYS                                                    G TLS                          $          0 .1 1           G O LD EN TELEC O M                                                 G LD N                        $      1 2 .2 5        0 .0 1 3 3                                   1 1 .6 2 %   $        0 .1 6   $         (0 .0 6 )
G R EAT LAKES C H EM                                                G LK                           $        2 7 .4 7           O S C A IN C                                                        OSCA                          $      1 8 .9 8        0 .1 6 7 1                                   7 1 .0 2 %   $        3 .1 7   $        2 4 .3 0

1 ) S h a r e s h e ld o f ( C a r v e - O u t o r H o ld in g b y P a r e n t C o m p a n y ) d iv id e d b y s h a r e s o u t s t a n d i n g o f t h e P a r e n t C o m p a n y .
2 ) C o m p a n y h a s a n n o u n c e d in t e n t t o d i s t r ib u t e s h a r e s o f c a r v e - o u t t o p a r e n t s h a r e h o ld e r s .
3 ) P a r e n t s e c o n o m ic o w n e r s h ip v a lu e o f c a r v e - o u t . T h is c o lu m n d o e s n o t in c lu d e c o n s id e r a t io n f o r v o t in g r ig h t s .                                                               N e w A r b L is tin g
4 ) E m b e d d e d V a l u e = ( C a r v e - O u t o r H o ld i n g p r ic e ) m u l t ip lie d b y t h e R a t io .                                                                                                                              E x p e c te d IP O P r ic e
5 ) R e s id u a l S tu b V a lu e = P a r e n t P r ic e le s s E m b e d d e d V a l u e .
                                                                                                                                                                                                                                                                                                                                                                                   57




6 ) P a r e n t P / E = P a r e n t p r ic e d i v id e d b y F ir s t C a ll E s t im a t e
7 ) R e s id u a l P /E = F i r s t C a l l e s t im a t e s o f t h e p a r e n t c o m p a n y le s s t h e h o l d in g c o m p a n y 's c o n t r ib u t io n , if t h e p a r e n t c o n s o li d a t e s t h e h o ld in g .
                                                                                                                                                                                                                                                                                                                                                                                       58
                                                                                                                                                                                                                                                                              In te n d       E c o n o m ic       Em bedded            R e s id u a l
P a re n t C o m p a n y                                                S ym b ol                     P r ic e                 C a r v e -O u t / H o ld in g                                        S ym b ol                        P r ic e        R a t io (1 )        T o S p in (2 )   % O w n e d (3 )         V a lu e         S tu b V a lu e
HARCOURT GENERAL                                                    H                              # N /A R l T i              N E IM A N M A R C U S -A                                           N M G /A                      $      3 1 .4 9         0 .0 9 0 3                                   1 7 .9 9 %     #VALU E!           #VALU E!
IC N P H A R M IN C                                                 IC N                           $    3 3 .1 8               R IB A P H A R M                                                    R IB A                        $      1 4 .0 0         1 .5 4 3 4                Y                  8 7 .4 0 %   $       2 1 .6 1   $         1 1 .5 7
ID T C O R P                                                        ID T                           $    1 1 .5 7               N E T 2 P H O N E IN C                                              NTOP                          $         4 .3 9        0 .9 4 0 0                                   4 8 .1 3 %   $         4 .1 3   $            7 .4 4
IM S H E A L T H IN C                                               RX                             $    2 5 .7 4               C O G N IZ A N T T E C H                                            CTSH                          $      4 2 .7 4         0 .0 2 3 8                                   9 2 .7 4 %   $         1 .0 2   $         2 4 .7 2
                                                                                                                               T R IZ E T T O G R O U P                                            T Z IX                        $      1 2 .4 5         0 .0 4 1 2                                   2 8 .7 0 %   $         0 .5 1   $         2 5 .2 3
                                                                                                                               G A R T N E R IN C -A                                               IT                            $      1 0 .4 5         0 .0 2 3 4                                   1 2 .7 4 %   $         0 .2 5   $         2 5 .4 9
                                                                                                                                                                                                                                                                                                                   $         1 .7 7   $         2 3 .9 7
W O R L D C O M IN C - W O R                                        W COM                          $        1 4 .1 7           D IG E X IN C                                                       D IG X                        $        5 .5 3         0 .0 1 3 6                                   6 2 .0 6 %   $         0 .0 7   $         1 4 .1 0
K U S H N E R -L O C K E C O                                        KLO C                          $          0 .0 8           U S S E A R C H .C O M                                              SRCH                          $        1 .8 8         0 .4 3 6 9                                   3 4 .2 5 %   $         0 .8 2   $          ( 0 .7 4 )
L IM IT E D IN C                                                    LTD                            $        1 6 .3 4           IN T IM A T E B R A N D S                                           IB I                          $      1 5 .8 4         0 .9 6 4 1                                   8 2 .4 1 %   $       1 5 .2 7   $            1 .0 7
                                                                                                                               G A L Y A N 'S T R A D I N G                                        G LYN                         $      1 0 .9 0         0 .0 0 5 3                                   1 3 .8 0 %   $         0 .0 6   $         1 6 .2 8
                                                                                                                               A L L IA N C E D A T A                                              ADS                           $      1 5 .5 1         0 .0 3 4 3                                   2 0 .4 0 %   $         0 .5 3   $         1 5 .8 1
                                                                                                                                                                                                                                                                                                                   $       1 5 .8 6   $            0 .4 8
LO EW S C O R P                                                     LTR                            $        5 2 .6 6           D IA M O N D O F F S H O R E                                        DO                            $      2 8 .2 5         0 .3 5 5 4                                   5 2 .5 8 %   $       1 0 .0 4   $         4 2 .6 2
                                                                                                                               C N A F IN L C O R P                                                CNA                           $      3 2 .8 5         0 .8 0 8 4                                   8 7 .0 1 %   $       2 6 .5 6   $         2 6 .1 0
                                                                                                                                                                                                                                                                                                                   $       3 6 .6 0   $         1 6 .0 6
LO R AL SPACE&C O M M                                               LO R                           $          2 .6 3           G LO BALSTAR TELEC                                                  GSTRF                         $        0 .3 9         0 .0 4 4 5                                   1 4 .9 5 %   $         0 .0 2   $            2 .6 1
L U C E N T T E C H IN C                                            LU                             $          6 .6 3           A G E R E S Y S T E M S -A                                          A G R /A                      $        5 .7 0         0 .2 7 7 1                Y                  5 7 .8 0 %   $         1 .5 8   $            5 .0 5
M A X X A M IN C                                                    MXM                            $        2 2 .3 0           K A IS E R A L U M IN U M                                           KLU                           $        3 .3 0         7 .5 4 7 2                                   6 2 .8 7 %   $       2 4 .9 1   $          ( 2 .6 1 )
M C S I IN C                                                        MCSI                           $        1 1 .5 1           Z E N G IN E IN C                                                   ZNGN                          $        2 .6 8         0 .6 6 8 8                                   7 4 .9 5 %   $         1 .7 9   $            9 .7 2
M E C H A N IC A L T E C H                                          MKTY                           $          6 .1 9           P L U G P O W E R IN C                                              PLUG                          $      1 3 .7 7         0 .3 4 0 1                                   2 4 .4 5 %   $         4 .6 8   $            1 .5 0
                                                                                                                               SATCON TECH                                                         SATC                          $        8 .7 1         0 .0 5 0 8                                   1 2 .9 6 %   $         0 .4 4   $            5 .7 4
                                                                                                                               BEACON POW ER                                                       BCON                          $        4 .3 6         0 .1 1 0 0                                     9 .2 0 %   $         0 .4 8   $            5 .7 1
                                                                                                                                                                                                                                                                                                                   $         5 .6 1   $            0 .5 8
M O T O R O L A IN C                                                MOT                            $        1 8 .4 2           N E X T E L C O M M -A                                              NXTL                          $      1 5 .7 5         0 .0 3 2 8                                     9 .5 9 %   $         0 .5 2   $         1 7 .9 0
                                                                                                                               N EX T LEVEL CO M M                                                 NXTV                          $        3 .4 5         0 .0 2 9 0                                   7 8 .2 4 %   $         0 .1 0   $         1 8 .3 2
                                                                                                                               N E X T E L P A R T N E R -A                                        NXTP                          $      1 2 .7 7         0 .0 0 5 9                                     6 .4 2 %   $         0 .0 8   $         1 8 .3 4
                                                                                                                               B R O A D C O M C O R P -A                                          BRCM                          $      4 6 .2 3         0 .0 0 3 9                                     3 .9 2 %   $         0 .1 8   $         1 8 .2 4
                                                                                                                                                                                                                                                                                                                   $         0 .8 7   $         1 7 .5 5
MRV COMM                                                            MRVC                           $           6 .5 3          L U M IN E N T IN C                                                 LM N E                        $        3 .0 4         1 .8 8 9 0                Y                  9 2 .3 1 %   $         5 .7 4   $            0 .7 9
                                                                                                                               O P T IC A L A C C E S S                                            OPXS                          $          -            0 .5 4 7 4                                   8 9 .3 0 %   $           -      $            6 .5 3
                                                                                                                                                                                                                                                                                                                   $         5 .7 4   $            0 .7 9
N A T L C IT Y C O R P                                              NCC                            $        3 2 .3 4           N A T L P R O C E S S IN G                                          NAP                           $    3 3 .4 0           0 .0 7 3 6                               8 6 .9 1 %       $         2 .4 6   $         2 9 .8 8
NAVARRE CORP                                                        NAVR                           $          1 .0 5           N E T R A D IO C O R P                                              NTRCD                         # N /A R l T i          0 .0 4 4 5                            #VALU E!              #VALU E!           #VALU E!
NETW ORK ASSOC                                                      NETA                           $        1 5 .2 1           M C A F E E .C O M C O R P                                          MCAF                          $    1 6 .5 7           0 .2 6 2 1                               8 1 .7 0 %       $         4 .3 4   $         1 0 .8 7
N E X T E L C O M M -A                                              NXTL                           $        1 5 .7 5           N E X T E L IN T L IN C                                             NXTI                          $        -              0 .1 1 1 1                               1 8 .9 2 %       $           -      $         1 5 .7 5
                                                                                                                               N E X T E L P A R T N E R -A                                        NXTP                          $    1 2 .7 7           0 .0 1 7 9                                 5 .3 6 %       $         0 .2 3   $         1 5 .5 2
                                                                                                                                                                                                                                                                                                                   $         0 .2 3   $         1 5 .5 2
N E W S C O R P -A D R                                              NW S                           $        3 7 .8 5           F O X E N T E R T A IN                                              FOX                           $      2 6 .2 5         1 .1 4 5 9                                   8 3 .0 0 %   $       3 0 .0 8   $            7 .7 7
NORTEL NETW ORKS                                                    NT                             $          8 .1 0           E N T R U S T IN C                                                  ENTU                          $        4 .8 2         0 .0 0 5 1                                   2 8 .3 5 %   $         0 .0 2   $            8 .0 8
X C E L E N E R G Y IN C                                            XEL                            $        2 7 .2 2           N R G E N E R G Y IN C                                              NRG                           $      2 0 .1 0         0 .4 3 0 1                                   8 8 .3 9 %   $         8 .6 4   $         1 8 .5 8
                                                                                                                                                                                                                                                                                                                                                              Implied Value of Stubs




SORRENTO NETW ORK                                                   F IB R                         $          8 .0 0           N E T S IL IC O N IN C                                              N S IL                        $        3 .9 0         0 .5 2 8 6                                   5 4 .8 5 %   $         2 .0 6   $            5 .9 4
P E P S IC O IN C                                                   PEP                            $        4 4 .3 0           P E P S I B O T T L IN G                                            PBG                           $      4 0 .9 0         0 .0 3 1 1                                   3 6 .8 6 %   $         1 .2 7   $         4 3 .0 3
P F IZ E R IN C                                                     PFE                            $        4 0 .1 9           NEUROGEN CORP                                                       NRGN                          $      2 0 .5 3         0 .0 0 0 5                                   1 7 .2 6 %   $         0 .0 1   $         4 0 .1 8
P H O E N IX T E C H L T D                                          PTEC                           $        1 4 .8 0           IN S IL IC O N C O R P                                              IN S N                        $        4 .3 8         0 .4 1 2 6                N                  8 4 .2 9 %   $         1 .8 1   $         1 2 .9 9
P H A R M A C IA C O R P                                            PHA                            $        4 4 .0 8           MONSANTO CO                                                         MON                           $      3 6 .2 3         0 .1 6 9 1                                   8 5 .1 1 %   $         6 .1 3   $         3 7 .9 5
P H IL IP M O R R IS C O                                            MO                             $        4 4 .9 9           K R A F T F O O D S IN C                                            KFT                           $      3 0 .3 5         0 .5 3 8 6                                   6 8 .0 1 %   $       1 6 .3 5   $         2 8 .6 4
P IC O H O L D IN G S                                               P IC O                         $        1 4 .2 2           HYPERFEED TECH                                                      HYPR                          $        1 .2 8         0 .2 0 2 7                                   1 5 .9 4 %   $         0 .2 6   $         1 3 .9 6
P L A IN S R E S O U R C E S                                        PLX                            $        2 5 .9 0           P L A IN S A L L A M E R                                            PAA                           $      2 5 .2 3         0 .5 4 8 2                                   3 9 .0 0 %   $       1 3 .8 3   $         1 2 .0 7
P S IN E T IN C                                                     P S IX E                       $          0 .0 5           X P E D IO R IN C                                                   XPDR                          $        0 .0 1         0 .2 0 8 8                                   8 0 .0 1 %   $         0 .0 0   $            0 .0 5
R ALC O R P H LD G S                                                RAH                            $        1 7 .9 0           V A IL R E S O R T S                                                MTN                           $      1 9 .9 0         0 .2 5 6 7                                   2 2 .0 8 %   $         5 .1 1   $         1 2 .7 9
R A L S T O N P U R IN A                                            RAL                            $        3 2 .1 7           D U P O N T (E I)                                                   DD                            $      4 2 .9 6         0 .0 5 5 8                                     1 .5 3 %   $         2 .4 0   $         2 9 .7 7
                                                                                                                               C O N O C O IN C -A                                                 C O C /A                      $      2 9 .9 0         0 .0 2 5 7                                     3 .9 3 %   $       4 2 .5 1   $            0 .4 5
                                                                                                                               IN T E R S T A T E B A K E R                                        IB C                          $      2 2 .3 5         0 .0 5 1 8                                   2 2 .5 3 %   $         1 .1 6   $         3 1 .0 1
                                                                                                                                                                                                                                                                                                                   $         4 .3 2   $         2 7 .8 5

1 ) S h a r e s h e ld o f ( C a r v e - O u t o r H o ld in g b y P a r e n t C o m p a n y ) d iv id e d b y s h a r e s o u t s t a n d i n g o f t h e P a r e n t C o m p a n y .
2 ) C o m p a n y h a s a n n o u n c e d in t e n t t o d i s t r ib u t e s h a r e s o f c a r v e - o u t t o p a r e n t s h a r e h o ld e r s .
3 ) P a r e n t s e c o n o m ic o w n e r s h ip v a lu e o f c a r v e - o u t . T h is c o lu m n d o e s n o t in c lu d e c o n s id e r a t io n f o r v o t in g r ig h t s .
                                                                                                                                                                                                                                                                                                                                                                                       Spin-Off Research




                                                                                                                                                                                                                                                    N e w A r b L is tin g
4 ) E m b e d d e d V a l u e = ( C a r v e - O u t o r H o ld i n g p r ic e ) m u l t ip lie d b y t h e R a t io .                                                                                                                               E x p e c te d IP O P r ic e
5 ) R e s id u a l S tu b V a lu e = P a r e n t P r ic e le s s E m b e d d e d V a l u e .
6 ) P a r e n t P / E = P a r e n t p r ic e d i v id e d b y F ir s t C a ll E s t im a t e
7 ) R e s id u a l P /E = F i r s t C a l l e s t im a t e s o f t h e p a r e n t c o m p a n y le s s t h e h o l d in g c o m p a n y 's c o n t r ib u t io n , if t h e p a r e n t c o n s o li d a t e s t h e h o ld in g .
                                                                                                                                                                                                                                                                           In te n d       E c o n o m ic       Em bedded           R e s id u a l
P a re n t C o m p a n y                                             S ym b ol                       P r ic e                  C a r v e -O u t / H o ld in g                                        S ym b ol                     P r ic e        R a t io (1 )        T o S p in (2 )   % O w n e d (3 )        V a lu e         S tu b V a lu e
R E L IA N T E N E R G Y                                            REI                             $ 3 1 .3 9                 R E L IA N T R E S IN C                                             RRI                           $ 2 1 .9 5          0 .8 2 3 2                Y                   7 9 .5 8 %   $      1 8 .0 7   $         1 3 .3 2
R E U T E R S G R P -A D R                                          RTRSY                           $ 7 3 .8 5                 T IB C O S O F T W A R E                                            T IB X                        $      9 .2 5       0 .4 6 0 6                                    5 5 .2 6 %   $        4 .2 6   $         6 9 .5 9
                                                                                                                               IN S T IN E T G R O U P                                             IN E T                        $ 1 3 .5 0          0 .8 6 9 3                                    8 6 .6 1 %   $      1 1 .7 4   $         6 2 .1 1
                                                                                                                                                                                                                                                                                                                $      1 6 .0 0   $         5 7 .8 5
R S L C O M M -C L A                                                R SLC F                         $     0 .0 2               D E L T A T H R E E IN C                                            DDDC                          $      0 .6 5        0 .5 3 5 9                                   3 9 .7 2 %   $        0 .3 5   $         ( 0 .3 3 )
S A B R E H O L D IN G S                                            TSG                             $ 4 9 .9 1                 T R A V E L O C IT Y .C O M                                         TVLY                          $    2 7 .1 0        0 .2 5 1 9                                   6 7 .8 4 %   $        6 .8 3   $         4 3 .0 8
S B C C O M M U N IC A T IO                                         SBC                             $ 4 3 .6 2                 P R O D IG Y C O M M - A                                            PRGY                          $      4 .5 6        0 .0 1 5 4                                   7 6 .6 5 %   $        0 .0 7   $         4 3 .5 5
S E A C O N T A IN E R S - A                                        S C R /A                        $ 1 8 .2 1                 O R IE N T E X P R E S S H                                          OEH                           $    2 0 .5 0        1 .0 0 3 5                Y                  5 9 .5 7 %   $      2 0 .5 7   $         ( 2 .3 6 )
S E P R A C O R IN C                                                SEPR                            $ 4 3 .9 8                 B IO S P H E R E M E D                                              BSM D                         $    1 1 .6 5        0 .0 4 9 1                Y                  3 0 .3 5 %   $        0 .5 7   $         4 3 .4 1
                                                                                                                                                                                                                                                                                                                                                                                  Spin-Off Research




SPX CO RP                                                           SPW                             $ 1 2 6 .9 5               IN R A N G E T E C H - B                                            IN R G                        $    1 0 .8 5        1 .9 0 7 4                                   8 9 .5 2 %   $      2 0 .7 0   $       1 0 6 .2 5
S T IL W E L L F IN L                                               SV                              $ 3 0 .8 9                 D S T S Y S T E M S IN C                                            DST                           $    4 4 .7 5        0 .1 8 5 0                                   3 1 .3 5 %   $        8 .2 8   $         2 2 .6 1
ST PAUL CO S                                                        SPC                             $ 4 2 .3 9                 J O H N N U V E E N -C L A                                          JNC                           $    6 2 .4 5        0 .0 1 9 2                                   1 3 .1 2 %   $        1 .2 0   $         4 1 .1 9
S Y N O V U S F IN L                                                SNV                             $ 3 4 .3 3                 TO TAL SYS SERVS                                                    TSS                           $    3 4 .0 0        0 .5 2 0 6                                   7 7 .4 8 %   $      1 7 .7 0   $         1 6 .6 3
TO RO NTO DO M BANK                                                 TD                              $ 2 5 .3 1                 TD W ATERHO USE G R                                                 TW E                          $      9 .5 5        0 .4 7 3 4                                   7 8 .3 1 %   $        4 .5 2   $         2 0 .7 9
                                                                                                                               K N IG H T T R A D IN G                                             N IT E                        $    1 1 .5 4        0 .0 1 4 3                                     7 .0 9 %   $        0 .1 7   $         2 5 .1 4
                                                                                                                                                                                                                                                                                                                $        4 .6 9   $         2 0 .6 2
TELEPH O N E & DATA                                                 TDS                             $ 1 0 7 .2 5               U S C ELLU LAR C O R P                                              USM                           $    5 6 .8 2        0 .7 2 9 1                                   7 0 .9 7 %   $      4 1 .4 3   $         6 5 .8 2
                                                                                                                               D E U T S C H E T E L -A D R                                        DT                            $    2 0 .4 7        2 .5 3 6 7                                     3 .1 3 %   $      5 1 .9 3   $         5 5 .3 2
                                                                                                                               V O D A F O N E G R P -A D R                                        VOD                           $    2 1 .3 3        0 .0 5 2 1                                     0 .0 4 %   $        1 .1 1   $       1 0 6 .1 4
                                                                                                                                                                                                                                                                                                                $      9 4 .4 6   $         1 2 .7 9
T IT A N C O R P                                                    TTN                             $       1 8 .8 5           S U R E B E A M C O R P -A                                          SURE                          $    1 1 .4 5        0 .7 6 2 3                Y                  8 3 .5 5 %   $        8 .7 3   $         1 0 .1 2
TREM O NT CO RP                                                     TRE                             $       3 5 .9 0           T IT A N IU M M E T A L S                                           T IE                          $    1 0 .0 0        1 .9 1 1 3                                   3 3 .3 2 %   $      1 9 .1 1   $         1 6 .7 9
T R IB U N E C O                                                    TRB                             $       4 1 .5 4           A O L T IM E W A R N E R                                            AOL                           $    4 6 .0 8        0 .0 2 0 1                                     0 .1 3 %   $        0 .9 3   $         4 0 .6 1
T R W IN C                                                          TRW                             $       4 3 .3 9           E -S Y N C N E T W O R K S                                          ESNI                          $      0 .4 5        0 .0 2 4 5                                   4 1 .7 0 %   $      4 2 .9 4   $           1 .0 0
                                                                                                                               C E L E R A G E N O M IC S                                          CRA                           $    2 9 .7 3        0 .0 0 4 2                                     0 .8 5 %   $        0 .1 2   $         4 3 .2 7
                                                                                                                               R F M IC R O D E V IC E S                                           RFMD                          $    2 9 .6 4        0 .1 8 6 7                                   1 4 .2 9 %   $        5 .5 3   $         3 7 .8 6
                                                                                                                                                                                                                                                                                                                $        5 .6 7   $         3 7 .7 2
T Y C O IN T L L T D                                                TYC                             $       5 3 .4 6           TYC O M LTD                                                         TCM                           $    1 1 .4 0        0 .2 3 2 5                                   8 6 .4 9 %   $        2 .6 5   $         5 0 .8 1
U C A R IN T L                                                      UCR                             $       1 1 .4 9           G R A F T E C H IN C                                                G RAF                         $    1 6 .5 0        0 .4 7 2 7                                   8 4 .5 9 %   $        7 .8 0   $           3 .6 9
U L T R A M A R D IA M O N D                                        UDS                             $       4 7 .9 7           S H A M R O C K L O G IS T I                                        UDL                           $    3 2 .0 0        0 .2 2 9 8                                   8 8 .6 6 %   $        7 .3 5   $         4 0 .6 2
U N IT E D G L O B A L C O -A                                       UCOMA                           $         7 .4 0           U N IT E D P A N - A A D R                                          UPCO Y                        $      1 .1 6        2 .3 8 4 2                                   5 2 .6 5 %   $        2 .7 7   $           4 .6 3
U S A N E T W O R K S IN C                                          USAI                            $       2 7 .1 4           H O T E L R E S IN C - A                                            ROOM                          $    4 5 .2 1        0 .1 2 0 5                                   6 7 .5 3 %   $        5 .4 5   $         2 1 .6 9
                                                                                                                               T IC K E T M A S T E R -B                                           TMCS                          $    1 5 .0 0        0 .1 7 2 2                                   6 1 .0 0 %   $        2 .5 8   $         2 4 .5 6
                                                                                                                                                                                                                                                                                                                $        8 .0 3   $         1 9 .1 1
U T IL IC O R P U N IT E D                                          UCU                             $       3 1 .4 4           Q U A N T A S E R V IC E S                                          PW R                          $    2 0 .3 5        0 .2 3 3 3                                   4 5 .5 6 %   $        4 .7 5   $         2 6 .6 9
                                                                                                                               A Q U IL A IN C                                                     IL A                          $    2 7 .0 1        0 .6 8 2 3                                   7 7 .5 2 %   $      1 8 .4 3   $         1 3 .0 1
                                                                                                                                                                                                                                                                                                                $      2 3 .1 7   $           8 .2 7
V E R IZ O N C O M M U N IC                                         VZ                              $       5 3 .5 0           G E N U IT Y IN C                                                   GENU                          $     2 .2 4         0 .0 3 9 2                                   1 0 .7 0 %   $        0 .0 8   $         5 3 .4 1
                                                                                                                               N T L IN C                                                          N LI                          $     9 .2 0         0 .0 0 9 0                                     8 .8 6 %   $        0 .0 9   $         5 3 .4 2
                                                                                                                                                                                                                                                                                                                $        0 .1 7   $         5 3 .4 2
                                                                                                                                                                                                                                                                                                                                                         Implied Value of Stubs




V IA C O M IN C -A                                                  V IA                            $       5 0 .3 5           B L O C K B U S T E R -A                                            BBI                           $    1 7 .6 5        1 .0 4 7 6                N                  8 2 .2 9 %   $      1 8 .4 9   $         3 1 .8 6
W A C K E N H U T C O R P -A                                        W AK                            $       1 7 .4 5           W ACKENHUT CO RREC                                                  W HC                          $    1 3 .9 8        0 .7 9 8 9                                   5 7 .1 1 %   $      1 1 .1 7   $           6 .2 8
W E S T E R N R E S IN C                                            WR                              $       1 8 .0 6           P R O T E C T IO N O N E                                            POI                           $      1 .3 0        1 .0 6 7 5                                   8 5 .0 0 %   $      1 7 .1 4   $           0 .9 2
                                                                                                                               O N E O K IN C                                                      OKE                           $    1 7 .4 4        0 .0 5 1 0                                     7 .2 8 %   $        0 .8 9   $         1 7 .1 7
                                                                                                                                                                                                                                                                                                                $        2 .2 8   $         1 5 .7 8
W IL L IA M S C O S IN C                                            W MB                            $       3 2 .6 0           W IL L IA M S C O M M U N I                                         W CG                          $      2 .1 8        0 .0 4 1 2                                     4 .5 7 %   $      3 1 .6 0   $           1 .0 0
                                                                                                                               W IL L IA M S E N E R G Y                                           W EG                          $    3 0 .2 5        0 .0 1 2 0                                   5 4 .1 4 %   $        0 .3 6   $         3 2 .2 4
                                                                                                                                                                                                                                                                                                                $        0 .4 5   $         3 2 .1 5
W O R L D C O M IN C - W O R                                        W COM                           $       1 4 .1 7           D IG E X IN C                                                       D IG X                        $     5 .5 3         0 .0 1 3 6                                   6 2 .0 6 %   $        0 .0 7   $         1 4 .1 0
ZAPATA CO RP                                                        ZAP                             $       2 2 .0 0           O M E G A P R O T E IN C P                                          OME                           $     1 .7 5         6 .0 6 4 8                                   6 0 .6 7 %   $      2 1 .4 8   $           0 .5 2
                                                                                                                               V IS K A S E C O M P A N IE                                         V C IC                        $     1 .0 5         2 .4 5 8 0                                   3 8 .3 9 %   $        2 .5 8   $         1 9 .4 2
                                                                                                                                                                                                                                                                                                                $      1 3 .1 9   $           8 .8 1

1 ) S h a r e s h e ld o f ( C a r v e - O u t o r H o ld in g b y P a r e n t C o m p a n y ) d iv id e d b y s h a r e s o u t s t a n d i n g o f t h e P a r e n t C o m p a n y .
2 ) C o m p a n y h a s a n n o u n c e d in t e n t t o d i s t r ib u t e s h a r e s o f c a r v e - o u t t o p a r e n t s h a r e h o ld e r s .
3 ) P a r e n t s e c o n o m ic o w n e r s h ip v a lu e o f c a r v e - o u t . T h is c o lu m n d o e s n o t in c lu d e c o n s id e r a t io n f o r v o t in g r ig h t s .                                                             N e w A r b L is tin g
4 ) E m b e d d e d V a l u e = ( C a r v e - O u t o r H o ld i n g p r ic e ) m u l t ip lie d b y t h e R a t io .                                                                                                                            E x p e c te d IP O P r ic e
5 ) R e s id u a l S tu b V a lu e = P a r e n t P r ic e le s s E m b e d d e d V a l u e .
                                                                                                                                                                                                                                                                                                                                                                                  59




6 ) P a r e n t P / E = P a r e n t p r ic e d i v id e d b y F ir s t C a ll E s t im a t e
7 ) R e s id u a l P /E = F i r s t C a l l e s t im a t e s o f t h e p a r e n t c o m p a n y le s s t h e h o l d in g c o m p a n y 's c o n t r ib u t io n , if t h e p a r e n t c o n s o li d a t e s t h e h o ld in g .
                                                                                                                                                                                                                                                                                                                                                    60
                                                                                           loo berg
                                                                                          B m                          Price                                                                                          loo berg
                                                                                                                                                                                                                     B m                 Price                    In t
                                                                                                                                                                                                                                                                    ten     co m
                                                                                                                                                                                                                                                                           E no ic      m ded
                                                                                                                                                                                                                                                                                       E bed          esidu
                                                                                                                                                                                                                                                                                                     R al
P       o pany
 arent C m                                         xch ge
                                                  E an                      AR
                                                                            D 's               yb
                                                                                              S m ol                   (in$)                      C      ut o
                                                                                                                                                   arve-O / H lding                                  E an
                                                                                                                                                                                                      xch ge            yb
                                                                                                                                                                                                                       S m ol            (in$)            atio
                                                                                                                                                                                                                                                         R (1)   T S (2)
                                                                                                                                                                                                                                                                  o pin       n
                                                                                                                                                                                                                                                                           %ow ed(3)    alu
                                                                                                                                                                                                                                                                                       V e(4)       tub alue
                                                                                                                                                                                                                                                                                                   S V (5)
Alcatel A                                    N aris
                                            E P                                          C EF
                                                                                          G P                     $        23.44            Alcatel O(Optronics)                               E P
                                                                                                                                                                                                N aris                G P
                                                                                                                                                                                                                     C OF            $       12.52       0.063     N        80.00%     $    0.78 $        22.66
A        em
 llianceS iconductor                        N S A N kt
                                             A D Q -M                                     LS
                                                                                         A C                               11.36            BroadcomCorp                                        A D Q -M   RM
                                                                                                                                                                                               N S A N kt B C                                46.38       0.012               0.22%     $    0.55
                                                                                                                                            C         em
                                                                                                                                             harteredS iconductor                               A D Q -M
                                                                                                                                                                                               N S A N kt C R
                                                                                                                                                                                                           HT                                27.55       0.052               1.55%     $    1.42
                                                                                                                                            C         em
                                                                                                                                             harteredS iconductor-S                            Singapore             C MS
                                                                                                                                                                                                                      S P                     2.75       0.518               1.57%     $    1.43
                                                                                                                                             nited icroelectronics-S
                                                                                                                                            U M                                                Taipei                2303TT                   1.07       8.193               2.54%     $    8.80
                                                                                                                                            V       em
                                                                                                                                             itesseS iconductor                                 A D Q -M
                                                                                                                                                                                               N S A N kt V S
                                                                                                                                                                                                           TS                                20.46       0.021               0.45%     $    0.42
                                                                                                                                                                                                                                                                                       $   12.62 $        (1.26)
 llianz G
A A                                         Frankfurt                                    A G
                                                                                          LV R                           371.52             D         ank G
                                                                                                                                             resdner B A                                       Frankfurt              R R
                                                                                                                                                                                                                     D BG                    51.72       0.497     N        22.00%     $   25.72
                                                                                                                                            BayerischeHypo-U V        F
                                                                                                                                                            nd ereinsba rankfurt                                      V R
                                                                                                                                                                                                                     H MG                    58.14       0.369     N        17.40%     $   21.48 $       324.33
A          as
 ustralianG Light Co                        AX
                                            S                                             G U
                                                                                         A LA                              16.50            AustralianPipelineTrust                            S
                                                                                                                                                                                               AX                     P U
                                                                                                                                                                                                                     A AA                     5.04       0.218              30.00%     $    1.10 $        15.40
 N aribas
B PP                                         N aris
                                            E P                                          B PF
                                                                                          N P                            114.40              ancw orporation
                                                                                                                                            B est C                                            N Y
                                                                                                                                                                                                ew ork                W
                                                                                                                                                                                                                     B E                     34.92       0.070              45.00%     $    2.43 $       111.97
 able irelessplc
C &W                                        London                                        W
                                                                                         C / LN                              4.94            T
                                                                                                                                            N LInc.                                            N Y
                                                                                                                                                                                                ew ork               NLI                      9.20       0.011              11.25%     $    0.10 $        4.84
C        acific
 anadianP Ltd                               Toronto                                      C C
                                                                                          P N                              38.79            PancanadianPetroleumLtd                            Toronto                C N
                                                                                                                                                                                                                     P PC                    28.43       0.693     Y         87%       $   19.71 $        19.08
 om erzbankA
C m         G                               Frankfurt                                    C KG
                                                                                          B R                              29.86             om irect ank G
                                                                                                                                            C D B A                                            Berlin                 O R
                                                                                                                                                                                                                     C MG                    10.45       0.159     N        58.65%     $    1.66 $        28.19
Conexant S     s
          ystem Inc                         N S A N kt
                                             A D Q -M                                     NT
                                                                                         CX                                  9.84           CharteredS iconductor-S
                                                                                                                                                      em                                       Singapore              S P
                                                                                                                                                                                                                     C MS                     2.75       0.042     N         0.75%     $    0.11 $        9.73
 orm ystem
F ulaS    s                                  el viv
                                            T A                                          F R IT
                                                                                          OT                             361.58             Crystal System S
                                                                                                                                                          s olutions                            A D Q -M   RS
                                                                                                                                                                                               N S A N kt C Y                                 2.65       0.436              39.24%     $    1.16
                                                                                                                                             agic oftw nterprises
                                                                                                                                            M S areE                                            A D Q -M   G
                                                                                                                                                                                               N S A N kt M IC                                2.00       1.560              51.96%     $    3.12
                                                                                                                                             intec dvancedT
                                                                                                                                            S A                         el viv
                                                                                                                                                           echnologies T A                                           ST
                                                                                                                                                                                                                     YC                      15.93       0.754              50.20%     $   12.01
                                                                                                                                            M      om
                                                                                                                                             ashovC pputers Ltd                                 el viv
                                                                                                                                                                                               T A                   MH
                                                                                                                                                                                                                      SV                     10.00       1.477              32.02%     $   14.77
                                                                                                                                                                                                                                                                                       $   31.05 $       330.53
FranceTelecomSA                              N aris
                                            E P                                          F F
                                                                                          TE P                             59.43            Wanadoo                                            E P
                                                                                                                                                                                                N aris                A
                                                                                                                                                                                                                     N DFP                    7.01       0.851     N        68.08%     $    5.96
                                                                                                                                            OrangeSA                                            N aris
                                                                                                                                                                                               E P                   O EF
                                                                                                                                                                                                                      G P                    10.20       2.901     N        86.85%     $   29.57
                                                                                                                                             T
                                                                                                                                            N LInc.                                             ew ork
                                                                                                                                                                                               N Y                   NLI                      9.20       0.011     N        18.35%     $    0.10
                                                                                                                                                                                                                                                                                       $   35.63 $        23.79
 lobal              m
G Light TelecomInc A erican                                                               B
                                                                                         GT                                  1.75            etrue om unications
                                                                                                                                            N C m                                              Venture                T /U N
                                                                                                                                                                                                                     NU C                     0.42       0.186              40.00%     $    0.08
                                                                                                                                            H          om unications
                                                                                                                                             ighpoint C m                                      Venture               H PC
                                                                                                                                                                                                                      G N                     0.03       0.348              45.00%     $    0.01 $        1.66
GroupeB           bert E russels
       ruxellesLam S NB                                                                  G LB
                                                                                          B B                              76.61                      lf A
                                                                                                                                            TotalFinaE S                                       E P
                                                                                                                                                                                                N aris                P
                                                                                                                                                                                                                     F FP                  182.34        0.174               3.39%     $   31.64
                                                                                                                                                                                                                                                                                                                   Foreign Implied Value of Stubs




                                                                                                                                            Suez                                                N aris
                                                                                                                                                                                               E P                   S F
                                                                                                                                                                                                                      ZE P                   43.73       0.535               6.74%     $   23.40
                                                                                                                                              erys A
                                                                                                                                            Im S                                                N aris
                                                                                                                                                                                               E P                   N F
                                                                                                                                                                                                                      KP                   102.91        0.030              25.28%     $    3.11
                                                                                                                                            RhodiaSA                                            N aris
                                                                                                                                                                                               E P                   R AFP
                                                                                                                                                                                                                      H                      10.76       0.071               5.51%     $    0.77
                                                                                                                                                                                                                                                                                       $   58.92 $        17.69
1 ) S h a re s h e ld o f (C a rve -O u t o r H o ld in g b y P a re n t C o m p a n y) d iv id e d b y s h a re s o u ts ta n d in g o f th e P a re n t C o m p a n y.
2 ) C o m p a n y h a s a n n o u n c e d in te n t to d is trib u te s h a re s o f c a rve -o u t to p a re n t s h a re h o ld e rs .
3 ) P a re n ts e c o n o m ic o w n e rs h ip v a lu e o f c a rve -o u t. T h is c o lu m n d o e s n o t in c lu d e c o n s id e ra tio n fo r vo tin g rig h ts .                                                     N e w A rb L is tin g
                                                                                                                                                                                                                                                                                                                                                    Spin-Off Research




4 ) E m b e d d e d V a lu e = (C a rv e -O u t o r H o ld in g p ric e ) m u ltip lie d b y th e R a tio .                                                                                                                E x p e c te d IP O P ric e
5 ) R e s id u a l S tu b V a lu e = P a re n t P ric e le s s E m b e d d e d V a lu e .
6 ) P a re n t P /E = P a re n t p ric e d ivid e d b y F irs t C a ll E s tim a te
7 ) R e s id u a l P /E = F irs t C a ll e s tim a te s o f th e p a re n t c o m p a n y le s s th e h o ld in g c o m p a n y 's c o n trib u tio n , if th e p a re n t c o n s o lid a te s th e h o ld in g .
                                                                                           loo b
                                                                                          B m erg                      Price                                                                                          loo be
                                                                                                                                                                                                                     B m rg              P e
                                                                                                                                                                                                                                          ric                         ten
                                                                                                                                                                                                                                                                    In t        0        m ded
                                                                                                                                                                                                                                                                                        E bed         e al
                                                                                                                                                                                                                                                                                                     R sidu
P       o pany
 arent C m                                         xch ge
                                                  E an                      D 's
                                                                            AR                S m ol
                                                                                               yb                      (in$)                       arv ut o
                                                                                                                                                  C e-O / H lding                                     xch ge
                                                                                                                                                                                                     E an              S m ol
                                                                                                                                                                                                                        yb               (in$)            a )
                                                                                                                                                                                                                                                         R tio(1    o pin
                                                                                                                                                                                                                                                                   T S (2)   %ow ed(3
                                                                                                                                                                                                                                                                                n )      alu
                                                                                                                                                                                                                                                                                        V e(4)      tub alue
                                                                                                                                                                                                                                                                                                   S V (5)
H       G A orzug
 enkel K A -V                               Frankfurt                                    HN G
                                                                                          E3 R                             85.63             lorox o pan
                                                                                                                                            C Cm y                                              e ork
                                                                                                                                                                                               N wY                  CX
                                                                                                                                                                                                                      L                        .3
                                                                                                                                                                                                                                             35 7         1.076               26 7%
                                                                                                                                                                                                                                                                                .5      $     .0
                                                                                                                                                                                                                                                                                            38 7 $        47.57
  ate apital C
iG C          orp                            A D Q -M
                                            N S A N kt                                   IGTE                                3.74            ascot ystem Ltd
                                                                                                                                            M S         s                                      B ba
                                                                                                                                                                                                om y                  ST
                                                                                                                                                                                                                     M C IN                   1.65        0.476               88 0%
                                                                                                                                                                                                                                                                                .8      $   0.79 $         2.95
Kingfisher Plc                              London                                       K FLN
                                                                                          G                                  5.35            a ram ubo vestisse E P ris
                                                                                                                                            C sto aD isIn        Na                                                  CF
                                                                                                                                                                                                                     YP                        .5
                                                                                                                                                                                                                                             68 0         0.063               56 7%
                                                                                                                                                                                                                                                                                .1      $   4.33 $         1.01
LafargeSA                                    N aris
                                            E P                                          LGFP                            114.17             LafargeCorp                                         e ork
                                                                                                                                                                                               N wY                  LAF                       .5
                                                                                                                                                                                                                                             34 2         0.297               57 5%
                                                                                                                                                                                                                                                                                .0      $     .2
                                                                                                                                                                                                                                                                                            10 7 $       103.91
                                                                                                                                                                                                                                                                                                                                                    Spin-Off Research




 D orporation
M CC                                        Toronto                                      M Z/AC
                                                                                          D N                                4.48           Maxxcom                                             oron
                                                                                                                                                                                               T to                  M XC
                                                                                                                                                                                                                      X N                     2.61        1.267      N        77 0%
                                                                                                                                                                                                                                                                                .8      $   3.31 $         1.18
NovartisSA                                  Virt-x                                       NV V
                                                                                         ON X                              35.21             h
                                                                                                                                            C ironCorp                                         N S A N kt C IR
                                                                                                                                                                                                A D Q -M   H                                   .8
                                                                                                                                                                                                                                             44 7         0.030               41 6%
                                                                                                                                                                                                                                                                                .7      $   1.37 $        33.84
 T orp
N TC                                        Tokyo                                        9432JP                       5,411.30               T ocom
                                                                                                                                            N TD oInc                                          Tokyo                 94 JP
                                                                                                                                                                                                                       37                 ,6
                                                                                                                                                                                                                                        14 18.58          0.398               64 6%
                                                                                                                                                                                                                                                                                .0            4.7
                                                                                                                                                                                                                                                                                        $ 5,82 8 $      (413.48)
 T ocom
N TD oInc                                   Tokyo                                        9437JP                     14,618.58                T ata
                                                                                                                                            N TD                                               Tokyo                 96 JP
                                                                                                                                                                                                                       13                    9.7
                                                                                                                                                                                                                                         5,24 7           0.151               54 9%
                                                                                                                                                                                                                                                                                .1      $ 795.10 $       ,8
                                                                                                                                                                                                                                                                                                       13 23.48
PearsonPlc                                  London                                       P O LN
                                                                                          SN                               14.85             e      s o pan d ria o ous
                                                                                                                                            R coleto C m iaE ito l C ntinu                                           R CS
                                                                                                                                                                                                                      E M                     6.13        0.128                 .0
                                                                                                                                                                                                                                                                              72 3%     $   0.78 $        14.07
 hilips lectronicsN
P E                V                         Nm
                                            E A sterdam                                  P IAN
                                                                                          H A                              36.24            aiw e icond r
                                                                                                                                           T anS m ucto                                        T ei
                                                                                                                                                                                                aip                    30
                                                                                                                                                                                                                     23 TT                    1.91        0.262               1.98%     $   0.50
 rud
P ential Plc                                London                                       P ULN
                                                                                          R                                12.34             g lc
                                                                                                                                            E gP                                                 nd
                                                                                                                                                                                               Lo on                 E GL
                                                                                                                                                                                                                      G N                     2.40        0.331      N        79 3%
                                                                                                                                                                                                                                                                                .5      $   0.80 $        11.55
R       roup lc
 eutersG P                                  London                                       R RLN
                                                                                          T                                12.29            Instinet                                           N S A N kt IN T
                                                                                                                                                                                                A D Q -M    E                                  .5
                                                                                                                                                                                                                                             13 0         0.145                 .6
                                                                                                                                                                                                                                                                              86 1%     $   1.96
                                                                                                                                                  oftw
                                                                                                                                            TibcoS areInc                                       A D Q -M   IB
                                                                                                                                                                                               N S A N kt T X                                 9.20        0.077                 .4
                                                                                                                                                                                                                                                                              59 9%     $   0.71 $         9.63
 oche oldin G enussV
R H gA -G           irt-x                                                                R GV
                                                                                          O X                            151.00                orato o     m r old e ork
                                                                                                                                            Lab oryC rpof A e H iN wY                                                LH                        .9
                                                                                                                                                                                                                                             80 5         0.032               30 8%
                                                                                                                                                                                                                                                                                .5      $   2.57 $       148.43
 iem ns G
S e A                                       Frankfurt                                     IE R
                                                                                         S G                               71.94                  on ch log G
                                                                                                                                            Infine Te no iesA                                  Frankfurt             IF G
                                                                                                                                                                                                                       X R                     .0
                                                                                                                                                                                                                                             31 6         0.499               65 9%
                                                                                                                                                                                                                                                                                .2      $     .5
                                                                                                                                                                                                                                                                                            15 0 $        56.44
 ulzer G
S A                                         Virt-x                                        U X
                                                                                         S NV                            201.19              u
                                                                                                                                            S lzer Medica                                       W lec
                                                                                                                                                                                               S XE                  SE S
                                                                                                                                                                                                                     MN W                      .7
                                                                                                                                                                                                                                             49 2         2.133      Y        74 0%
                                                                                                                                                                                                                                                                                .0      $ 106.05 $        95.14
Telephone&D S       sA erican
           ata ystem m                                                                   TS
                                                                                         D                               107.30              S ellu orp
                                                                                                                                            U C lar C                                           m
                                                                                                                                                                                               A erican              UM
                                                                                                                                                                                                                      S                        .8
                                                                                                                                                                                                                                             56 2         0.729      N        70 7%
                                                                                                                                                                                                                                                                                .9      $     .4
                                                                                                                                                                                                                                                                                            41 3
                                                                                                                                            D      e
                                                                                                                                             eutsch Telekom                                    Frankfurt              T R
                                                                                                                                                                                                                     D EG                    26 6
                                                                                                                                                                                                                                               .7         2.537      N        3.13%     $     .8
                                                                                                                                                                                                                                                                                            67 9
                                                                                                                                            V      e ro lc
                                                                                                                                             odafon G upP                                        nd
                                                                                                                                                                                               Lo on                  O
                                                                                                                                                                                                                     V DLN                    2.13        0.521      N        0.04%     $   1.11
                                                                                                                                                                                                                                                                                        $ 110.43 $        (3.13)
 ele
T fonicaSA                                  Continuous                                   T FS
                                                                                          E M                              15.92                  e o
                                                                                                                                            TerraN tw rks                                      C ntinu
                                                                                                                                                                                                o ous                 R M
                                                                                                                                                                                                                     T RS                      .3
                                                                                                                                                                                                                                             10 0         0.056                 .7
                                                                                                                                                                                                                                                                              35 0%     $   0.58 $        15.34
 erra etw
T N orks                                    Continuous                                   T RS
                                                                                          R M                              10.30                  uro .V
                                                                                                                                            LycosE peN .                                       Berlin                  Y R
                                                                                                                                                                                                                     LC G                     1.07        0.161      N          .0
                                                                                                                                                                                                                                                                              44 0%     $   0.17 $        10.13
 tiliC nited
U orpU                                       ew ork
                                            N Y                                          UU
                                                                                          C                                31.65            Q      e
                                                                                                                                             uantaS rvices                                     N wY
                                                                                                                                                                                                e ork                 W
                                                                                                                                                                                                                     P R                       .3
                                                                                                                                                                                                                                             20 4         0.233                 .6
                                                                                                                                                                                                                                                                              34 4%     $   4.75
                                                                                                                                             q
                                                                                                                                            A uila                                              e ork
                                                                                                                                                                                               N wY                  ILA                     27 5
                                                                                                                                                                                                                                               .1         0.682                 .5
                                                                                                                                                                                                                                                                              77 2%     $     .5
                                                                                                                                                                                                                                                                                            18 2
                                                                                                                                             n e o im
                                                                                                                                            U itedN tw rks L ited                               ZE
                                                                                                                                                                                               NS                     N Z
                                                                                                                                                                                                                     U LN                     3.52        0.750                 .2
                                                                                                                                                                                                                                                                              56 5%     $   2.64
                                                                                                                                             n ne
                                                                                                                                            U itedE rgyLimited                                 S
                                                                                                                                                                                               AX                     E U
                                                                                                                                                                                                                     U LA                     1.42        1.252                 .9
                                                                                                                                                                                                                                                                              33 5%     $   1.78
                                                                                                                                                                                                                                                                                                                   Foreign Implied Value of Stubs




                                                                                                                                                                                                                                                                                        $     .6
                                                                                                                                                                                                                                                                                            27 9 $         3.96
Vivendi Universal                            N aris
                                            E P                                          EF
                                                                                         XP                                75.93            V        n nm nt
                                                                                                                                             ivendi E viro e                                   E P ris
                                                                                                                                                                                                Na                    IE
                                                                                                                                                                                                                     V FP                      .7
                                                                                                                                                                                                                                             56 4         0.201               63 4%
                                                                                                                                                                                                                                                                                .0      $     .4
                                                                                                                                                                                                                                                                                            11 1 $        64.52
Weston(George) Ltd                          Toronto                                      WC
                                                                                         N N                               67.33                   om nie
                                                                                                                                            LoblawC pa sLtd                                     oron
                                                                                                                                                                                               T to                  LCN                       .0
                                                                                                                                                                                                                                             35 9         1.320               62 1%
                                                                                                                                                                                                                                                                                .8      $     .3
                                                                                                                                                                                                                                                                                            46 1 $        21.03
 orld om
W C Inc                                      A D Q -M
                                            N S A N kt                                   WO
                                                                                          CM                               67.33             m        a acoes
                                                                                                                                            E bratel P rticip                                  S P ulo
                                                                                                                                                                                                ao a                  BP Z
                                                                                                                                                                                                                     E T 4B                   5.33         .6
                                                                                                                                                                                                                                                         13 08                19 0%
                                                                                                                                                                                                                                                                                .0      $     .4
                                                                                                                                                                                                                                                                                            72 7 $        (5.14)
1 ) S h a re s h e ld o f (C a rve -O u t o r H o ld in g b y P a re n t C o m p a n y) d iv id e d b y s h a re s o u ts ta n d in g o f th e P a re n t C o m p a n y.
2 ) C o m p a n y h a s a n n o u n c e d in te n t to d is trib u te s h a re s o f c a rve -o u t to p a re n t s h a re h o ld e rs .
3 ) P a re n ts e c o n o m ic o w n e rs h ip v a lu e o f c a rve -o u t. T h is c o lu m n d o e s n o t in c lu d e c o n s id e ra tio n fo r vo tin g rig h ts .                                                     N e w A rb L is tin g
4 ) E m b e d d e d V a lu e = (C a rv e -O u t o r H o ld in g p ric e ) m u ltip lie d b y th e R a tio .                                                                                                                E x p e c te d IP O P ric e
5 ) R e s id u a l S tu b V a lu e = P a re n t P ric e le s s E m b e d d e d V a lu e .
6 ) P a re n t P /E = P a re n t p ric e d ivid e d b y F irs t C a ll E s tim a te
                                                                                                                                                                                                                                                                                                                                                    61




7 ) R e s id u a l P /E = F irs t C a ll e s tim a te s o f th e p a re n t c o m p a n y le s s th e h o ld in g c o m p a n y 's c o n trib u tio n , if th e p a re n t c o n s o lid a te s th e h o ld in g .
62                                                                                                   Spin-Off Research



                                                 Stub Monitor
                                                                                           Current
                                          Ticker           Parent      Sub.      Stub       Stub
Parent               Sub.                 Par. / Sub.       Price      Price     Ratio      Value        Min.           Max.
Apollo Group         Phoenix Online       APOL - UOPX     $ 44.14    $ 33.12   0.408351   $ 30.62    $    15.10     $    32.09
Citizens Comm.       Electric Lightwave   CZN - ELIX      $ 11.81    $ 1.40    0.156247   $ 11.59    $    11.07     $    15.08
Comverse Tech.       Ulticom              CMVT - ULCM     $ 29.42    $ 19.87   0.191401   $ 25.62    $    21.25     $   113.50
FMC Corp.            FMC Techologies      FMC - FTI       $ 63.45    $ 17.35   1.724193   $ 33.54    $    32.96     $    38.43
General Motors       GM-Hughes            GM - GMH        $ 63.13    $ 19.91   0.756521   $ 48.07    $    31.21     $    52.77
Global Crossing      Asia Global          GX - AGCX       $ 6.20     $     -   0.355343   $ 6.20     $      5.06    $    21.78
Limited              Intimate Brands      LTD - IBI       $ 16.55    $ 15.90   0.924986   $ 1.84     $      1.30    $     6.28
MCSi                 Zengine              MCSI - ZNGN     $ 16.55    $ 2.80    0.020657   $ 16.49    $    11.45     $    33.33
MRV Comm             Luminent             MRVC - LMNE     $ 6.60     $ 3.04    1.732247   $ 1.33     $     (0.39)   $     8.08
Network Assoc.       McAfee.com           NETA - MCAF     $ 15.02    $ 16.76   0.263418   $ 10.61    $      2.54    $    19.72
Xcel                 NRG                  XEL - NRG       $ 26.84    $ 19.35   0.430089   $ 18.52    $    11.78     $    19.32
Sorrento Networks    NetSilicon           FIBR - NSIL     $ 7.82     $ 3.90     0.53011   $ 5.75     $      2.50    $    63.01
News Corp.           FOX                  NWS - FOX       $ 37.78    $ 7.82    0.573728   $ 33.29    $    17.58     $    42.31
Pharmacia            Monsanto             PHA - MON       $ 44.90    $ 35.00   0.169105   $ 38.98    $    36.12     $    56.76
Philip Morris        Kraft                MO - KFT        $ 45.21    $ 30.50   0.110017   $ 41.85    $    39.76     $    46.09
Reuters              Tibco Software       RTRSY - TIBX    $ 45.21    $ 9.40    0.482694   $ 40.67    $    58.75     $    89.96
Sea Containers       Orient Express       SCR - OEH       $ 18.50    $ 20.50   0.914297   $ (0.24)   $     (2.69)   $     7.08
Synovus              Total Systems        SNV - TSS       $ 34.18    $ 33.90   0.542345   $ 15.79    $      9.21    $    16.11
St. Paul             John Nuveen          SPC - JNC       $ 34.18    $ 62.49   0.084924   $ 28.87    $    28.87     $    52.06
SPX Corp.            Inrange Tech.        SPW - INRG      $ 126.16   $ 15.90   1.905386   $ 95.86    $    30.04     $   104.78
Stilwell Financial   DST Systems          SV - DST        $ 30.81    $ 45.16   0.184673   $ 22.47    $    16.10     $    44.44
Telephone & Data     U.S. Cellular        TDS - USM       $ 107.24   $ 57.95   1.205958   $ 37.35    $    15.65     $    41.41
Titan                Surebeam             TTN - SURE      $ 18.76    $ 11.31   0.856859   $ 9.07     $      5.59    $    11.54
Toronto Dominion     TD Waterhouse        TD - TWE        $ 25.45    $ 33.90   0.514577   $ 8.01     $      8.01    $    22.51
TYCO                 TYCOM                TYC - TCM       $ 53.32    $ 10.76    0.26504   $ 50.47    $    37.51     $    55.37
UnitedGlobalCom      United Pan-Europe    UCOMA - UPCOY   $ 7.81     $ 1.16    1.070905   $ 6.57     $      1.80    $    19.08
UtiliCorp            Aquila               UCU - ILA       $ 31.47    $ 27.20   0.682086   $ 12.92    $    12.46     $    35.39
Spin-Off Research                                                                                                                   63


                                                 Spin-Off Calendar by Date
                                Listed                                      Announce   Record     Spin-Off     Report      Tax
Parent                 Symbol   Options   Spin-Off                 Symbol     Date      Date        Date        Date      Exempt Ratio

SGI                    SGI        Y       MIPS Technology          MIPS     02/26/99              06/20/00     June-00             .135:1
Hewlett-Packard        HWP        Y       Agilent                  A        03/02/99              06/02/00     June-00      Y      .37:1
iGate                  IGTE               Mascot                   MSCT     03/07/00              06/12/00    April-00             CO
Great Lakes Chemical   GLK        Y       OSCA                     OSCA     09/20/99              06/15/00     July-00             CO
Deluxe Corp.           DLX        Y       eFunds                   EFDS     01/31/00              06/26/00     June-00             CO/SP
Methode Electronics    METHA      Y       Stratos Lightwave        STLW     02/23/00              06/26/00     June-U              CO/SP
Ford                   F          Y       Visteon                  VC       04/14/00              06/28/00     June-00      Y      1:7.637
Verizon                VZ         Y       Genuity                  GENU     04/10/00              06/28/00     May-00              CO
AutoNation             AN         Y       ANC Rental Corp.         ANCX     08/02/99              06/30/00     June-00      Y      1:8
Delta Woodside         DLW                Duck Head                DHA      02/09/99   06/19/00   06/30/00     July-00      Y      1:10
                                          Delta Apparel            DLA      02/09/99   06/19/00   06/30/00     July-00      Y      1:10
Orckit                 ORCT               Tioga Technologies       TIGA     02/10/00   06/28/00   07/03/00     July-00      Y      1:1
Intelligroup           ITIG               Seranova                 SERA     11/04/99   05/12/00   07/06/00     July-00      Y      1:1
Daisytek               DZTK       Y       PFSweb                   PFSW     09/21/99   06/19/00   07/07/00     July-00      Y      .81:1
Eaton                  ETN        Y       Axcelis Technologies     ACLS     02/24/00              07/10/00     July-00             CO/SP
Kansas City Southern   KSU        Y       Stilwell Financial       SV       02/03/98   6/28/00    07/12/00     July-00      Y      2:1 | 1:2
3Com                   COMS       Y       Palm                     PALM     09/14/99   07/11/00   07/27/00     July-00      Y      1.5:1
Tyco Int.              TYC        Y       Tycom                    TCM      03/10/00              07/27/00    August-00            CO
Actuant                ATU        Y       APW Ltd                  APW      01/27/00              07/31/00    August-00     Y      1:1
America Online         AOL        Y       America Online Latin     AOLA     07/06/00              08/07/00    August-00            CO
EMC                    EMC        Y       McDATA                   MCDT     05/31/00              08/09/00    August-00            CO/SP
Sea Containers         SCR.A              Orient Express Hotels    OEH                            08/10/00    August-00            CO/SP
BRE Properties         BRE                VelocityHSI              VHSI     03/16/00   08/07/00   08/15/00    August-00     N      1:5
Ziff-Davis             ZD                 Key3Media                KME                            08/21/00     Sept-00             1:2
IMS Health             RX         Y       Synavant                 SNVT     03/28/00   07/28/00   09/01/00     Sept-00    Y-Opin   1:20
MCSi                   MCSI               Zengine                  ZNGN     08/22/00              09/22/00     Sept-00             CO
SPX                    SPW        Y       Inrange Technologies     INRG     06/05/00              09/22/00     Sept-00             CO
Southern Company       SO         Y       Mirant                   MIR      04/17/00              09/27/00     Oct-00       Y      CO/SP
HNC Software           HNCS       Y       Retek                    RETK                09/15/00   09/29/00    August-00     Y      ~1.24:1
Cabot Corp.            CBT        Y       Cabot Micro-Electonics   CCMP     07/29/99   09/13/00   09/29/00     Sept-00      Y      1:3.7
Lucent Tech.           LU         Y       Avaya                    AV       03/01/00   09/20/00   09/30/00     Sept-00      Y      1:12
Dun & Bradstreet       DNB        Y       Moody’s                  MCO      12/15/99   09/20/00   09/30/00     Sept-00      Y      1:2
Apollo Group           APOL       Y       Phoenix Online           UOPX     03/28/00              09/28/00     Oct-00              CO/TR
Enron                  ENE        Y       New Power Holding        NPW                            10/ 05/00    Oct-00              CO
SARA LEE               SLE        Y       Coach                    COH      05/30/00              10/05/00     Oct-00              CO/SP
St. Joe                JOE        Y       Florida East Coast       FLA      10/27/99   9/18/00    10/09/00     Oct-00       Y      .23:1
Global Crossing        GX         Y       Asia Global Crossing     AGCX                           10/06/00     Oct-00              CO
Pharmacia              PHA        Y       Monsanto                 MON      08/30/00              10/18/00     Oct-00              CO
MRV Communications     MRVC       Y       Luminent                 LMNE     07/29/00              11/10/00     Nov-00              CO/SP
BEI Technologies       BEIQ               OpticNet                          08/24/00   10/30/00   11/21/00     Sept-00      N      1:10
Sybron (Apogent-AOT)   SYB                Sybron Dental Special    SYD      04/24/00   11/30/00   12/11/00     Dec-00       Y      1:3
Aetna                  AET        Y       Aetna Health Services             07/20/00   12/13/00   12/14/00     Dec-00              1:1
Fluor                  FLR        Y       Massey Energy            MEE      06/08/00   11/30/00   12/21/00     Dec-00       Y      1:1
Eaton                  ETN        Y       Axcelis Technologies     ACLS     02/24/00   12/06/00   12/29/00     Dec-00       Y      1.15:1
Deluxe Corp.           DLX        Y       eFunds                   EFDS     01/31/00   12/11/00   12/29/00                  Y      .55:1
64                                                                                                            Spin-Off Research


                                      Spin-Off Calendar by Date
                                  Listed                                        Announce    Record     Spin-Off      Report        Tax
Parent                   Symbol   Options Spin-Off                    Symbol      Date       Date        Date         Date       Exempt     Ratio

National Data            NDC          Y    Global Payments            GPN       12/21/99    01/19/00   01/31/00      Jan-00         Y       .8:1
EMC                      EMC          Y    McDATA                     MCDT      05/31/00    01/24/01   02/08/01     February        Y       ~1:36
Williams                 WMB          Y    Williams Energy LP         WEG        10/ /00               02/06/01     February                CO
Cabletron                CS           Y    Riverstone Networks        RSTN      2/00/00                02/15/01     February        Y       CO/SP
RPC                      RES               Marine Products            MPX       01/14/00    02/16/01   03/01/01     March-00        Y       .6:1
Lucent                   LU           Y    Agere Systems              AGR       06/   /00   03/23/01    March       March-00                CO/SP
Titan                    TTN          Y    Surebeam                   SURE      08/14/00    03/16/01    March       March-00                CO
Cablevision              CVC          Y    Rainbow Media Group        RMG                   03/15/01   03/30/01     March-00                1:2
Ceridian                 CEN          Y    Arbitron                   ARB       07/18/00    03/16/01   04/01/01     March-00        Y       1:5
Sara Lee                 SLE          Y    Coach                      COH       05/30/00               04/05/01     March-U         Y       Split
Southern Company         SO           Y    Mirant                     MIR       04/17/00    03/21/01   04/02/00     April-01        Y       .397:1
Ultramar Diamond Sham.   UDS          Y    Shamrock Logistics         UDL       08/14/00               04/10/01      Nov-00                 CO
Williams Companies       WMB          Y    Williams Comm.             WCG                   04/09/01   04/23/01     April-01        Y       .82:1
UtiliCorp                UCU          Y    Aquila                     ILA       12/13/00               04/23/01      April-U                CO/SP
Methode Electronics      METHA        Y    Stratos Lightwave          STLW      02/23/00    04/05/01   04/30/01      April-01       Y       ~1.5 : 1
Reliant Energy           REI          Y    Reliant Resources          RRI       07/27/00               04/30/01      May-01                 CO/SP
Adaptec                  ADPT         Y    Roxio                      ROXI      02/21/01    04/30/01   05/11/01      May-01                 ~1:6
AT&T                     T            Y    AT&T Wireless              AWE       12/06/99               05/25/01      May-01                 SPLIT
Reuters                  RTR LN   Y        Instinet                   INET      02/08/01               05/28/01      May-01                 CO
WorldCom                 WCOM         Y    MCI-Tracker                MCIT      11/01/00               06/08/01      June-01                1:25
Philip Morris            MO           Y    Kraft                      KFT                              06/12/01      June-01                CO
FMC                      FMC          Y    FMC Technology             FTI       10/31/00               06/14/01      June-01                CO/SP
Rockwell                 ROK          Y    Rockwell Collins           COL       12/08/00    06/15/01   07/01/01      June-01                1:1
Equifax                  EFX          Y    Certegy                    CEY       10/02/00    06/27/01   07/07/01      July-01        Y       1:2
AT&T                     T            Y    AT&T Wireless              AWE       12/06/99    06/22/01   07/09/01      May-01         Y       .3218:1
Cabletron / Enterasys    CS-ETS       Y    Riverstone Networks        RSTN       2/00/00    07/27/01   08/06/01      July-01        Y       .51 : 1
Bristol-Myers Squibb     BMY          Y    Zimmer Holdings            ZMH       02/22/01    07/27/01   08/07/01      July-01        Y       1:10
Thermo Electron          TMO          Y    Kadant                     TFT       01/31/00    07/30/01   08/08/01      July-01        Y       .061 : 1
AT&T                     T            Y    Liberty Media              LMG.A/B   11/15/00               08/10/01      July-01        Y       1:1
                                                                      LMC.A/B
ESS Technologies         ESST         Y    ViAlta                     VLTA      07/20/00    07/23/01   08/10/01     August-01               1.208 :1
Millipore                MIL          Y    Mykrolis                   MYK       10/03/00                August      August-01       Y       CO/SP


Pitney Bowes             PBI          Y    Office Systems             PBO       12/11/00                Sept-01      Dec-00         Y       SP
Lucent                   LU           Y    Agere Systems              AGR       06/   /00               Sept-01     March-01                Split
MRV Communications       MRVC         Y    Luminent                   LMNE      07/29/00                             Nov-00         P       1.82 : 1
Western Resources        WR           Y    Westar Industries                    03/29/00                            April-00                SP
Constellation (BGE)      CEG          Y    Constellation Energy Grp             10/23/00               4th qtr-01    Nov-00                 SP
Sea Containers           SCR.A             Orient Express Hotels      OEH       07/ /00                4th-qtr-01   March-01    Y-Opinion   .75:1
Enterasys Networks       ETS          Y    Aprisma Technology                   02/01/00               4th-qtr-01                   P       1:2
FMC                      FMC          Y    FMC Technology             FTI       10/31/00               4th-qtr-01    June-01                SP
ICN Pharmaceuticals      ICN          Y    Ribapharm                  RIBA      06/15/00                             Oct-00                 CO
Titan                    TTN          Y    Surebeam                   SURE      08/14/00                            March-00                SP
ICN Pharmaceuticals      ICN          Y    Int. Operations                      06/15/00                             July-00                CO
Nortel Networks          NT           Y    Optic’s Division                     09/15/00                             Oct-00                 CO
US Industries            USI          Y    LCA                        LXA       09/00/00    01/10/00                  Jan-U         Y       1:10
Bellsouth                BLS          Y    Latin Wireless                       03/29/00                            April-00        Y       CO/TR
Verizon                  VZ           Y    Verizon Wireless                                                                                 CO
Reliant Energy           REI          Y    Reliant Resources          RRI       07/27/00               1st qtr-02    May-01                 SP
Spin-Off Research                                                                                                                   65



                                                 Spin-Off Calendar by Date
                                 Listed                                       Announce   Record    Spin-Off     Report      Tax
 Parent                 Symbol   Options   Spin-Off                  Symbol     Date      Date      Date         Date      Exempt Ratio




 Diageo                 DEO          Y     Burger King                        06/22/00              2002        July-00           CO
 Computer Associates    CA           Y     Software and Services              08/07/00                         August-00          CO
 ECI Telecom            ECIL         Y     Multiple Break Up                  08/03/00                          Sept-00
 QUALCOMM               QCOM         Y     Semiconductor Business             07/25/00              Oct-01     August-00          CO
 Conexant               CNXT         Y     Internet Infrustructure            09/13/00                          Oct-00            SP
 Unitrin                UNIT               Curtiss-Wright            CW       11/06/00                          Nov-00            SP
 Motorola               MOT          Y     Propel                    PRPL     06/27/00                          July-00           CO
 Acacia Research        ACRI         Y     CombiMatrix                        11/22/00                          Feb-01            CO
 AMCOL                  ACO                Nanocor Unit                       12/27/00                          Feb-01            SP
 Corel                  CORL               Linux Distribution Unit            01/23/01                          Feb-01
 Eastman Chemical       EMN          Y     Specialty Chemicals                02/05/01              2001        Feb-01            SP
 Novell                 NOVL         Y     Volera                             02/02/01              2002        Feb-01            CO/SP
 AON                    AOC          Y     Underwriting Business              04/20/01                          May-01            SP
 USX                    MRO          Y     US Steel                  X        04/24/01             12/31/01     May-01            SP
 Continental Airlines   CAL          Y     ExpressJet                XJET                                                         CO/SP
 Allegheny Energy       AYE          Y     Allegheny Energy Supply            07/23/01            Nov/Dec-01   August-01          CO/SP
 Thermo Electron        TMO          Y     Viasys Healthcare                                      4th-qtr-01   August-01          SP
 IMPCO TECH             IMCO         Y     Quantum Technology                                     4th-qtr-01   August-01
 Mercury Air            MAX                Mercfuel                                                            August-01
66                                                                                                  Spin-Off Research


                         Foreign Spin-Off Calendar by Date
                                                                          Announce   Spin-Off    Report      Tax
Parent                Symbol          Spin-Off                Symbol        Date      Date        Date      Exempt Ratio

Zurich Allied         ZUAN            PSP Swiss Property      PSPN                   03/07/00   Mar-00             SP
Siemens               SIE GR          Infineon                IFX                    03/13/00   Mar-00             CO
Lycos – Acquired      LCOS            Lycos Europe            LCY NM                 03/22/00   April-00           CO
Deutsche Telekom      DTE GR          T-Online                TOI N       03/27/00   04/17/00   April-00           CO
Toys-R-Us             TOY             Toys-R-Us Japan         7645 JP     03/20/00   04/25/00   April-00           CO
Commerzbank           CBK GR          Comdirect               COM GR                 06/05/00   June-00            CO
Prudential            PRU LN          Egg                     EGG                               June-00            CO
Roche                 ROG SW          Givaudan Fragrances                 12/06/99   06/08/00    Jan-00            SP
France Telecom        FTE FP          Wanadoo                 NAD FP                 07/19/00   July-00            CO
Vivendi Universal     EX FP           Vivendi Environment     VIE FP                 07/19/00   Aug-00             CO
Modern Times          MTGN SS         Metro International     MTROA,B     04/18/00   08/18/00   May-00             1:1
National Power        NP              Innogy Technology       IOG         11/17/99   10/03/00   Dec-99             SP
Alcatel               ALA             Fiber Optics            OPTRO       07/27/00   10/20/00    Oct-00            TR
Penninsular and       POC LN          Princess Cruises        POC         02/24/00   10/23/00   Oct-00        Y    1:2
Oriental
BG Group              BG LN           Lattice Group           LAT LN                 10/23/00    Nov-00            1:1
Pearson PLC           LSE: PSON       Recoletos               REC SM                 10/23/00    Nov-00            CO
Novartis              NVS             Syngenta                SYT                    11/14/00    Nov-00            CO
Novo Nordisk          NVO.N           Novozymes               NNZYMB DC   09/09/99   11/17/00    Nov-00            CO, 1:1
Telefonica S.A.       TEF             Telefonic Moviles       TEM         09/29/00   11/20/00    Dec-00            CO
Telefonos de Mexico   TMX             America Movile          AMX         09/27/00   02/07/01    Oct-00            SP
France Telecom        FTE             Orange                  OGE FP                 02/16/01     Jan-01           CO
Sony                  SNE / 6758 JP   Internet Unit           67585 JP    11/ /00    06/20/01    Dec-00            TR
Alcatel               CGE FP          Nexans                  NEX FP                             July-01           IPO
McDonald’s            MCD             McDonald’s Japan        2702 JP                            July-01           CO
Sulzer                SUN VX          Sulzer Medica           SMEN VX     07/09/01   07/10/01   August-01          2:1
Kingfisher            KFG LN          Woolworths Group PLC                08/24/01   08/28/01   August-01          1:1
Canadian Pacific      CP              PanCanadian Petroleum   PCP                    10/01/01    April-01          0.684:1
                                      Fording                 FDG                    10/01/01    April-01          0.166:1
                                      Canadian Pacific Rail   CP                     10/01/01    April-01          0.50:1
                                      CP Ships                TEU                    10/01/01    April-01          0.25:1
                                      Fairmont Hotels         FHR                    10/01/01    April-01          0.25:1
Nycomed Amersham      NYE-ADR         APBiotech               APBI        08/07/00               Aug-00            CO
Scottish Power        SPI.N           Telecommunications                  09/17/99               Oct-99            CO
Deutsche Telekom      DTE GR          Deutsche Tele. Mobile               01/25/00                                 CO
United Pan-Europe     UPCOY           Chello Broadband        CHLO        03/21/00               June-00           CO
Psion                 PON LN          Symbyan                             08/08/00               Sept-00           CO
Lynx Group            LNX LN          Office Mgmt. Software               11/01/00               Nov-00
Roche Holdings        ROG SW          BASILEA Pharmaceutica               10/17/00               Nov-00            CO
Aventis               AVE-ADR         Agreva                              11/ /00                Dec-00            SP
British Telecom       BTY-ADR         BT Wireless                         11/ /00                Dec-00            CO
British Telecom       BTY-ADR         Yell                                11/ /00                Dec-00            CO
Great Universal       GUS LN          Burberry                            11/ /00                Dec-00            CO
TV Azteca             TZA-ADR         Unefon                              11/15/00               Dec-00            SP
United Pan-Europe     UPCOY           UPC Germany                         11/ /00                Dec-00            CO
Innogy Holdings       IOG             Regenesys                           04/02/01               April-01          CO
Lufthansa             LHA GR          SkyChefs                            07/23/01              August-01          CO

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:3
posted:1/25/2013
language:Unknown
pages:66