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Technology Stocks : Lucent Technologies (LU)

LU 2.580

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To: Sawtooth who wrote (3708)	8/21/1998 3:03:00 AM
From: djane	Read Replies (2) of 21876

Another view on LU/ASND (via the ASND thread). Comments anyone? To: djane (52385 ) From: Stimpson J. Cat Friday, Aug 21 1998 1:53AM ET Reply # of 52454 Well this is just one cat's opinion but... LU paid a heck of a lot of money for Yurie. They had darn well better make a good show of their product set. If they buy ASND and Yurie gets thrown out, how would analysts react? LU has a huge team of people working on their access switch platform and has devoted much of the companies resources to it's future. Will they scrap all that for ASND? LU has a carrier class core switch. Now it doesn't have nearly the capabilities of the ASND GX, but it also is backed by tremendous resources. LU's switch development is far slower and takes far more people to achieve a fraction of what ASND/CSCC has. Buying ASND won't change that. LU knows that most of ASND's talent will bolt if they buy them. So LU will continue to buy smaller players and work on streamlining their operations. LU bought Livingston and are now devoting a lot of resources to integrating that platform into the 5ESS. They would have to throw away a lot of time and effort if they want to switch to ASND. Given all this and the fact that ASND could cost 20 Billion, I doubt analysts would react positively to any announcement to buy ASND. Yes, analysts today say it would be good. But some analysts speak with forked tounge. Others just don't have a clue. Look at how fast they changed their mind about the Stratus deal. Face it, LU already has ASND's product set. They just can't match ASND's quality and that is something they cannot buy. The only reason LU would buy ASND would be to kill competition. And that deal would be big enough to attract the Justice dept which doesn't like that sort of thing.

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