Legacy Storage Systems Inter. Inc-VAST 1500 Gig Message Board

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Technology Stocks : Legacy Storage Systems Inter. Inc-VAST 1500 Gig

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To: Neil Leckett who wrote (50)	12/21/1996 9:34:00 PM
From: Glen Arnelien	of 64

Financial Post Article - Dec 21/96 "High-tech firm Legacy decided to change horses" Article discusses how Legacy management had made a choice, deciding that Rexon (Tecmar) offered the best opportunity despite the potential of Quasarmetrics' leading technology. Dave Killins said "We decided to cut our losses and focus on the proven technology and expertise Rexon brought to us, along with their distribution and manufacturing expertise". The decision to shed the Canadian operations was made easier by disappointing sales of its data-storage products. Killins says "Like anyone else, I would have liked to see the results come sooner. But I think the management structure in place today can produce results soon." The reporter, Mark Evans, says that management told the investment community its original plan was not viable and, rather than force this strategy, Legacy has changed horses in mid-stream. "Depending on what transpires, it may be viewed as an ill fated decision or a stroke of genius." What was the financial implications of the shedding of the Canadian operations? Did Legacy basically give away a losing operations' technology and must now incur further write-offs during this quarter or was the sale proceeds sufficient to provide profits this quarter due to last quarter's write-off being recovered? Since Legacy has not issued a press release on this "sale", where can I locate this information or do I have to wait until the quarterly results. Given Killins success lately, should a Legacy investor have any hope of a recovery in the share price or has the stock been oversold due to the abundance of bad news in 1996? Rexon was restructure by Legacy after coming out of bankrutcy. Some production in Singapore was moved to third party partners, and 100 employees were eliminated in the U.S. Its cost structure is now comparable with rival data-storage makers. What is the future of Legacy's listing on the TSE given that its operations are now based in the U.S. with Tecmar?

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