Naz News, Gappers and FLE's

[mcmike]

RSTN dd: At least 30% upside left?

8/29/2005
RSTN is the #2 Ethernet switch/router player behind Cisco
http://www.heavyreading.com/document.asp?doc_id=78734
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Broker's analyst thinks there are 132mill. shares outstanding.
Yahoo stats = 130.1
http://finance.yahoo.com/q/ks?s=RSTN.PK
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good overview: Lucent Gets Riverstoned
http://www.lightreading.com/document.asp?doc_id=88390&WT.svl=news1_1
"Lucent has made what's called a stalking-horse bid, having already signed a purchase agreement to pay $170 million for Riverstone's assets"
takeawy:$170mill/132mill O/S=$1.29/share
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Company Snapshot:
http://www.corporateinformation.com/snapshot.asp?Cusip=769320102
Riverstone Networks, Inc.. The Group's principal activity is to design and manufacture routers that enable service providers to convert network bandwidth into differentiated services for their customers. It provides metropolitan area networking solutions that enable service providers to convert raw bandwidth into profitable services over legacy and next-generation infrastructures. The routers are specifically designed for the metropolitan area network, which encompasses service providers. The products of the Group support optical and electrical interfaces to ensure that services can be quickly provisioned across a broad range of media types. The customers of the Group include local exchange carriers, long distance carriers, Internet service providers, metropolitan service providers, content hosting providers and cable operators. As at 02-Mar-2002, the Group had approximately 150 customers located in the United States, Asia Pacific and Europe.
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Indebtedness decrease:
5/9/2005 8-K

On May 5, 2005, Riverstone returned an aggregate principal amount of $65,875,000 of the outstanding $131,750,000, at par, to the Noteholders together with accrued and unpaid interest (and liquidated damages) from (and including) December 1, 2004, to (but excluding) the Redemption Date.
outstanding indebtedness of about $66million
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11/2/2005 8-K
RIVERSTONE NETWORKS ANNOUNCES 2ND QUARTER (ended August 27, 2005) OPERATING PERFORMANCE,
PLAN TO LOWER COMPANY’S BREAK-EVEN TARGET

http://secfilings.nasdaq.com/filingFrameset.asp?FileName=0001193125%2D05%2D214363%2Etxt&FilePath....

"Riverstone ended the fiscal second quarter 2006 with cash and marketable securities totaling $120.3 million, compared with $139.8 million at the end of the first quarter, a decrease of $19.5 million."
takeawy:burned about $20mill

Riverstone's cash position a year prior:
RIVERSTONE NETWORKS REPORTS PRELIMINARY REVENUE, CASH POSITION
FOR SECOND QUARTER FISCAL 2005
"The Company's cash position, defined as cash equivalents and marketable securities, totaled $256.4 million at August 28, 2004, compared with $242.4 million at May 29, 2004, and $254.4 million as of February 28, 2004."
http://www.riverstonenet.com/news/pr_2004/2004_10_14-1.shtml
takeawy:"burning" about $15mill/qtr year/year

My broker's analyst thinks the company's current cash position is about 35million after subtracting the remaining $66million notes outstanding: or .26/share
my calculated takeawy: 2 quarters @15mill/quarter + $66mill(remaining note indebtedness =$96mill. If you take 96 from the 120mil cash you are left with 24mill or .18/share
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Caveats:
1. Tough to do evaluations when you don't have audited financials
2. RSTN.pk may soon trade by appointment? on grey sheets if the SEC delists them from the pinks.
http://www.riverstonenet.com/news/pr_2006/2006_02_07-3.shtml
I don't know when this might be, but it could substantially inhibit liquidity.
3. Could company expenses winding up it's affairs eat into the company's remaining cash reserves and then into the $170million left for shareholders? i.e. will there be less than $1.29 distributed?