Kevin, I am not bearish on VLSI. I have kept buying more (recently only for my girlfriend since all I am doing is feeding margin calls). I now have what for me is an enormous position, tremendously underwater. Given the positioning of the company, I am comfortable that in time I will have a very successful investment. I just bought too early.
My concern with Stein is that he did not act in the shareholders' best interests. (Actually maybe he did, but we have no way of knowing, and that is what bothers me.) In my mind what should have happened is he should have said, "we have a $28 deal on the table with LSI. However, the Company is worth far more than that, I don't want to sell at that price. Who else is interested?"
This way the shareholders could have made the decision about what the Company is worth, not Stein. I could have said, I'll take $28 here's my shares. If the majority agreed, we'd have a deal. Also, maybe a higher offer would have surfaced. If not, and the deal was voted down, so be it. At least the owners would have decided.
As for Stein's replacement, I don't have a clue. I don't know who else is available. Maybe Beyer, maybe not. But from all appearances Stein is not looking out for the owners of the Company, which means he's looking out for himself. And that's wrong. For that reason, he should go. If he quit tomorrow, and it took a while to find a replacement, how much lower can the stock go? It's selling for book value, and more than half of the book is in cash.
Jay |
