Actually Sam, I don't begrudge the folks from Silver Lake or Texas Pacific for their respective roles in this deal. That is their discipline. That is the nature of leading edge financial intermediation in the most dynamic and adaptive economy in history.
I don't even blame Veritas one bit for being party to this complex deal. My family was so ahead with our Veritas shares that I would have been willing to wait a little bit more and see how far their superior competitive positioning in a booming networked storage industry would take them if SEG hadn't sold its controlling 38% position in Dragon to LHSP and created a much better and more unique opportunity.
Clearly, the SEG BOD and management team have been the focus of my bewilderment. The silver lining in all these is that they've already crossed the point of no return and played their ultimate hand, IMO, with one key part of their equation -- VRTS shares -- now backed by the dynamics of being part of the S&P 500 index. What more can they ask for?
If they succeed in convincing the institutional investors to go ahead with this deal, or a sweetened version of it, then, my friend, that would be a supreme feat of free market persuasion and they would deserve all the money they make from taking SEG private at this point of their product cyle and industry cycle.
If, on the other hand, they fail then surely there is no honorable option left but for the BOD and the management team to resign. I do not think there will be any set of factors that can counter the supreme financial argument that would be fairly self-evident THEN that a new board and management team would be NECESSARY to maximize the market demand for the stock of the premier independent disk drive company with major product cycles in enterprise drives (10k and 15k drives), desktop drives (leading edge areal density), tape drives (LTO), NAS/SAN (Xiotech), and software (Business Intelligence) while backed up by highly-liquid and marketable securities (VRTS, ZOOX, LHSP, CVCI, SNDK). Going against that reasonable course of action in an effort to preserve their power bases would simply mean going against individual and institutional investors who have already rejected their ploy.
There is of course the legal dimension to all these, but a lawsuit is just another form of negotiation and as we know, there should be a spare $100 million or so somewhere in SEG to take care of all that.<g>
These rascals are really lucky that the American version of Hari Kiri is a uniquely Silicon Valley type of mushy testimonial at some fancy seaside hotel complete with hefty severance packages. A very public display of mass disembowelment would have been worth a quick drive up the coast and a day off from the daily grind.<g> |
