PMC-Sierra (PMCS) Message Board

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Technology Stocks : PMC-Sierra (PMCS)

PMCS 11.65

0.0%

Jan 25 4:00 PM EST

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From: Rustam Tahir	7/5/2000 8:15:03 AM
	of 3818

MSDW on Datum purchase: • PMCS announced plans to acquire privately held Datum Telegraphic in a stock transaction valued at approx. $125MM. Datum’s 30 employees have focused on developing highly differentiated power amplifier technology for wireless infrastructure applications. • Datum’s chip will reside close to the antenna while PMCS’s traditional chips reside closer to the copper or fiber network uplink. In the next few years we expect PMCS to address more of the rapidly growing wireless basestation semiconductor opportunity. We expect Datum to introduce initial products in C2001. • The acquisition should close in C3Q00 with very modest dilution. After PMCS reports C2Q00, we will modify our model for the first time to include the amortization of goodwill resulting from both the Malleable and Datum acquisitions. However, we will continue to value PMCS on an earnings before goodwill basis. • We reiterate our Outperform rating and 12-month price target of $225. We believe PMCS’s bookings and billings in C2Q were very strong, and management is likely to give a strong outlook into C2H00.

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