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Technology Stocks : The New QLogic (ANCR)
QLGC 16.070.0%Aug 24 5:00 PM EST
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To: George Dawson who wrote (26810)5/10/2000 11:25:00 AM
From: George Dawson  Read Replies (2) of 29386
 
Today's St. Paul Pioneer Press Article on QLogic acquisition of Ancor:

pioneerplanet.com

Basically a discussion of how the deal could fail and comments from QLogic's CFO on the fact shareholders do not have the information they have at this time to make an informed decision.

I disagree with him. I have all the information I need. After considering converting Ancor shares to QLogic shares to protect against this possibility - I realized that was only a slightly more favorable strategy. If the deal did fail, you would see a bump in QLogic's price, but what would happen long term? You would see margins and possibly market share erode and more importantly you would see the entire FC market diminished.

Contrary to Brocade's public opinion, they currently are not meeting FC demand and there is more and more hype about GE competition for FC in the SAN. It apparently takes engineers and a lot more engineers than Ancor has to deliver end to end SAN solutions. The learning curve for OEMs has been mentioned as a deterrent to the FC SAN ramp in the past and this probably rules out using in house experts for this purpose.

I see the QLogic/Ancor deal as being vital to the entire FC market and not just the two companies involved. This is far more important than any short term price fluctuation.

Obviously the perspective of a long term investor rather than a trader.

George D.
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