But with it, if the bottom didn't fall from under the entire market at the worst possible time for Spansion, but, Spansion would have been the one (maybe the only one) standing.
That is part of the job of a company executive to foresee risks and exercise caution especially when you are so levered! There was absolutely no chance that Spansion would have been the only one standing even if the economy was doing good! If you have followed the memory industry long enough, you should know that companies have been in business for years despite losing money for years!
I am ok with firing, but not ok with resignation. That to me means deserting ones post in the middle of the worst storm.
Well, when you are that high up, and you have a board that has supported you all the way, they don't fire you, they ask you to tender in your resignation. I don't think he decided to quit on his own, he was forced out.
Spansion was more leveraged than others, and that is the reason for bankruptcy. Sometimes the leverage works, other times it does not. The worst possible scenario is for market to collapse when you are at your lowest cash level, which is what happened. Additionally, the credit markets collapsed at the same time and some of the cash the company thought it had (the UBS note) turned out not to be a marketable security. So it turned out to be a perfect storm for Spansion.
You can think what you want and continue defending management actions but the results are in and it is clear that poor executive decisions and excessive risk taking, at a time the company couldn't afford to, has resulted in a complete collapse of a technologically stronger company in the NOR space! |
