Hello all ... it's been a while since I stuck my two cents into SI ... hello Paul, good to see you here. I have a few comments (as usual) and a perspective on the merger progress.
I lived through the SNPX/WFLT merger and beleive me I am watching carefully for signs of the same NIH (Not-Invented-Here) attitudes with the BAY/NT deal. I stay pretty tuned into the merger activities and talk to many people in the know here. I certainly have my trigger on the button in case I see this thing coming apart. I have been through too much over the last several years to go through it all again.
There are factions with-in BAY that are certainly skeptical about the merger, but overwhelmingly the word internally is highly positive. (not too surprising since we work here :-) ... but I am not getting the picture that people are going to bail from BAY anytime soon. Most people want to give this thir best shot and see how things are in 12-18 months. The first part of the merger will be with the Enterprise Data Networks group. This is the division that has those ads woth the coffee shop, newsstand, and barber shop. I think they are great ads. These guys have built a huge business (1 billion) in a very short amount of time. We will be teaming up with them to attack the first part of the integration story.
On the stock price, this was the source of the most whining that I heard internally. I wish these guys (you know who you are) would grow up ... the stock price of BAY at $38 /share is MEANINGLESS. Unless of course you are waiting to bail out at the first possible moment, iun which case please leave now. (I am talking about BAY Employees not shareholders).. most of the whining died down fairly quickly after understanding the incredible possiblilities with NT/BAY ... granted we can certainly screw this up if we aren't on top of it.
Mostly though, there isnt much of a chance that NT and Bay will act like SNPX/WFLT. That was a completely different type of merger. Although the merger in my opinion was the right thing to do, we lacked clear leadership at the top between the coasts so we were allowed to fight internally for too long.
This seems less likely with NT given their size and given the willingness that I have seen with the EDN folks to have Bay help them get the technology they need even faster. (I welcome any EDN employees to comment directly on that point) ...
My crystal ball says that we are going to see a slightly improved stock price up to the merger .. I would not be surprised to see BAY back at the offering price by close of transaction. After that I think we will see a speculative run based on all of the positive presentations that BAY and NT will be making to the analyst community. That could easily propel NT back to their all-time high of $69... then earnings will start to matter more and the synergies will need to start becoming evident.
For the record, I am more convinced now that Bay Networks equipment will be playing a significant role in the networks of major corporations for the next 20 years.... and I cannot say that for CS nor COMS ... let alone the other bit players. The unfortunately elusive $100 Bay Stock that was the mantra of Bay employees will continue now as the $166 NT stock. I am utterly convinced that this will happen. The only thing that I cant know, is the when. Which of course is the only thing that matters when you are an investor. For your info, my time frame is under 5 years. (sorry daytraders)
House has secured a significant place for Bay networks in the Data Networking / Telecommunications business. Ne deserves incredible kudos for that... after all, we are the Rodney Dangerfields of networking and frankly I am getting pretty tired of it. Thank you Dave House for bringing the recognition to Bay that we deserve!
So I'll be monitoring this thread as the "Bay Under house" thread has served its purpose. I encourage the Bay gang to jump on the NT bandwagon with the rest of us and join this thread!
Cruiser |
