It was interesting that someone recently questioned Maxtor's numbers and at the time, it didn't really seem to matter as Maxtor was a small integrated piece in the overall Hyundai puzzle and didn't really warrant attention anyway. Most important issues were market share vs our beloved companies.
Now, in light of their selling a part of the company in an IPO it makes more sense for them to have published these numbers. Afterall, it's pretty rare for IBM or Fujitsu to really give much insight into their internal numbers on storage. Why should Hyundai?
So, it was all a preparation for an IPO. Maybe all the glow was not so bright. Sure is a good time for Hyundai to try to get some money out of an IPO when the perception is that Maxtor is one of the best performing companies in what might be a bottoming market for storage.
Bad thing is it doesn't look like Maxtor will benefit from the cash raised. The IPO will reduce some Maxtor debt (to whom), but mostly give Hyundai some badly needed cash. But what about Maxtor's expansion needs? It is my impression that they need to build another fab, and that had been planned in China and is now on hold (?). Maxtor is short of cash to do so and Hyundai didn't seem to have the credit to make it happen.
So, with current production capacity nearly used up and no money to add more, what's the point in buying Maxtor?
This is all conjecture raised upon lack of sleep and paranoia. Even so, I think I'll hold off buying into this one.
Regards,
Mark
PS It would seem that if Maxtor doesn't actually get any working capitol out of the IPO, that would be favorable to the competition. If I misunderstand this arrangement and Maxtor will gain some cash or establish new credit lines, that would mean they would be able to expand and thus continue the pressure. So, perhaps wiser minds can explain it to me. |
