Article on Ascend in 2/12/Forbes Mag. Part 1
By Michael Noer
Ascend Communications could not
exist anywhere but in Silicon
Valley. Just shy of its tenth
birthday, Ascend's (ASND) revenues
exceed $1 billion, and yet until three
months ago the Alameda, Calif.-based
maker of computer networking gear
didn't even budget out a year in
advance.
Charting Ascend's rise and fall.
Not that it mattered. Until last year,
Ascend's stock was a rocket ride,
enriching Ascend executives,
employees, and countless ordinary
investors. Then in 1997 the stock
plummeted from a high of $77.75 to
as low as $22, and the company was
slapped with a shareholder lawsuit.
Iranian-born chief executive Mory
Ejabat, a 47-year-old engineer with a
M.B.A. from Pepperdine, once
enjoyed accolades from the business
press, including being named one of
the "thirty who matter" by Forbes
ASAP in October 1996. Now his
future is uncertain as dark whispers
swirl around Wall Street
watercoolers that he is out of his
league. Just last March Ascend paid
$3.7 billion for Cascade
Communications, a Westford,
Mass.-based networking firm. Today
Ascend itself is takeover bait.
What went wrong?
Until last year,
Ascend's stock was a
rocket ride.
"Ascend went through growing
pains," says Ascend's new CFO
Michael Ashby, with British
understatement. "Ascend woke up to
find itself a billion-dollar startup. It
had grown extremely rapidly, both
internally and through acquisitions.
You add all that up and here was a
$1.2 billion company without the
infrastructure necessary for a
company of that size. |
