|
My hunch is that they were shopping this around...even when they denied they were. Even though this industry may bear fruit in the future, the sale of WFR would most likely occur prior to the full ramping up of industry sales and/or capacity. The buyer, most likely an industry player, would have to justify the value vs. the cost of acquiring more capacity in a highly cyclical industry. Since all the wafer producers are not operating at full capacity now, and have shelved future plant expansion, the question now becomes what is the cost of building more capacity vs. buying more capacity for the future and the much anticipated upturn in demand. I would have to think that wafer end users are already seeking other sources of wafers to insure that they have a steady and predictable supply to build their chips on. They are probably in the process of qualifying other wafer producers, and in time this will be result in decreased sales for WFR, which will ultimately effect WFR's book value (and selling price!) moving forward. Therefore any sale will probably happen ASAP. Another question is can WFR's existing market production be met by the other players? On the surface, given the current production utilization figures it could. I would have to think that the other wafer producers are falling all over each other, knocking on WFR's existing customers doors seeking the chance to be qualified, in an effort to increase their market share. Afterall, they have the capacity, and adding more production decreases their overall production costs. And how badly does Veba/Viag want to sell? It is highly likely that due to the merger, and a re-focusing of business, Veba/Viag just wants to sell WFR, take the charges, close the books, and forget about it and start concentrating on their future. Piecemeal or whole, they want out, no matter how they spin it. |
