Adaptec (ADPT) Message Board

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Technology Stocks : Adaptec (ADPT)

ADPT 17.33

-0.2%

3:59 PM EST

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To: Tom M who wrote (1186)	3/16/1998 10:53:00 AM
From: Mark Brophy	Read Replies (1) of 5944

Is the deal a steal? While it's true that Adaptec paid double Hyundai's price of 3 years ago, you're not considering the new fab investment. At the time Hyundai acquired the company, there was a 6 inch fab in Fort Collins, which was shut down a couple of weeks ago. Now, there is a state of the art 8 inch 0.35u fab in C. Springs. How much is the new fab worth? Well, Intel paid DEC $700m for a similar fab. S3 sold 8% of a fab for $70m and it was considered a steal by the buyer, who already owned 50% of the fab. My only concern is that the new fab is underutilized. If Adaptec can manufacture their chips in the acquired fab, it will surely be used to capacity. I'll check with one of their engineers to get the full story.

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