S3 (A LONGER TERM PERSPECTIVE) Message Board

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Technology Stocks : S3 (A LONGER TERM PERSPECTIVE)

SIII 0.0001000

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May 12 5:00 PM EST

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To: JAG who wrote (9134)	1/30/1998 2:24:00 PM
From: Bill Lin	Read Replies (3) of 14577

$9 is too low, $12 a more likely bid. remember that S3 has convertible debt with a strike price of $19.375. They will be screwed in this deal. It is very unlikely unless AMD has an additional $103.5mm in cash (which at last glance, THEY DONT). Remember, AMD has to buy a 0.18um fab next year, as well as 300mm production system, and get higher yields from their new designs (intel at 450mhz at end of year, and AMD lucky to be at 333mhz by december). Also AMD is cash poor, so a stock deal will be more likely, which will dilute their shareholder value, which will piss off their stockholders (what strategic advantage do we get with S3? none) This guy might be reporting on speculative thinking. I can tell you that everyone (company) is thinking of buying everyone else some of the time. But actually pulling the trigger is something else. I would put a 2% probability to this rumor. BL ps tell me why AMD didn't spend $40mm to buy CRUS portfolio and now wants to spend $500mm for the same thing?

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