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Technology Stocks : Xicor ?
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To: steve olivier who wrote (2813)1/8/2000 5:05:00 PM
From: physicsdh   of 2920
 
Steve/Jeff, I have a hypothetical question. Lets say the fab is sold as suggested by Jeff/others and it sells for a lot more than its carried on the books. Maybe they get 75M. Lets say the sale is not final until Q3. Lets say the sale is announced in Jan.

How would this be handled? Would they take a write-down now and recoup it when the sale is finalized. Wouldn't the amount of the sale over book value be treated as a capital gain? If they had a capital gain of say 35M from sale of the fab how much of their tax credits could they use against that sale? All of them?

In this scenario couldn't they take a write-off in Q4 and bring in all the tax reserves onto the books. This might mean that the earnings next year would be at the higher tax rate and make more sense of the SNDV projection of $.55?

Of course it would also mean tons of cash for Xicor.

Thoughts?
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