Bucky89 post on Mahesh and LU/ASND
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Message 20278 of 20310
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AnnMK
bucky89
Aug 16 1998
7:01PM EDT
AnnMK,
Take it easy. Ascend's quarter is in the bag, and they will surprise massively to the
upside in mid-October. There is a lot of tree shaking going on now. People want
into Ascend at a good price. That Tim Luke guy on the SI Thread wants to scare
people into selling him their ASND at 41. Shorts want to cover before earnings
announcement, LU takeover, etc... My suggestion is DON'T FALL OUT OF THE
TREE!!!
As far as your questions, I believe that Mahesh Gunmukhi guy, even if he is the chief
architect of the GX550, will not seriously impact Ascend if he is leaving. There are
plenty of other engineers that will remain at Ascend, bound by golden
handcuffs--options that vest over four years. And when it's time for these guys to
leave, yet others will take their place. This is normal for hi tech. Cisco, HP, and
many other large hi tech companies have dealt successfully with this pattern for
many years.
Regarding your second question, I doubt any of the execs at Ascend have any
intention of selling to LU. LU can't talk to them until Oct 1, and in the absence of
talks they have to proceed as if there will be no takeover by LU.
Regardless, I think LU will take out ASND whether the ASND execs intend to sell
or not. There is too much at stake for LU, and if the ASND execs don't cooperate
then it will be a hostile takeover. Not only is ASND the only truly effective weapon
available on the market which can be used to attack Cisco, but I think the takeover
will be a defensive one as well for LU. ASND is developing interfaces which map
ATM directly onto fiber, bypassing the need for SONET which is LU's cash cow.
This isn't a long-term threat--major customers (Williams) are testing this technology
right now. If they don't control this technology, LU will risk serious exposure to their
core business.
bucky89
ASND: Quote | Profile | Research
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AnnMK_
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