Ensonic purchase is good news for CREAF, here's why...
In 1998 we will see the death of the ISA bus in PC's
All PC's in 1998 will have several PCI slots and AGP.
CREAF probably needs Ensonic to make the PCI product
transition more easially. This is similar to when
ADPT bought the PCI-SCSI chip division from WDC. Back
then ADPT was having trouble developing an integrated
silicon chips for SCSI3 PCI, so they bought the superior
designed chip from WDC, and WDC got out of the business.
Similar to CREAFs deal recently with OPTi, CREAF would
rather get in bed with Ensonic, then continue to fight
them in the marketplace.
Similar to CREAFs deal with Cambridge recently, CREAF
obviously want's to be synonomus with EVERTHING that
is SOUND in Personal Computers -related. So this deal
fits in well with that ultimate goal by expanding into
the PC to Musical Instruments market which has both
a high end high margin segment, and also vast untapped
consumer potential. The technology exists today where
and Electronic Band can Jam over the Internet, and
maybe even get Peter Garbiel to join in.
Some who fear that Win/Tel will eventually find a way
to make CREAF's standards obsolete should take heart.
The more CREAF consolidates it's position in this
niche, the stronger it's hand will be in the future.
We should get more details on how this fit works out
on Thursday, so we may see some hesitation in the stock
price till then. Obviously, they will put a positive
spin on these developements, so we can hope for another
analysts opinion upgrade Friday or Monday.
Don't be suprised if the stock opens lower because
as soon as the Street smells a $77 million charge,
they will sell on instinct. Later on, when cooler
heads interpret the small print, buying will resume. |
