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Technology Stocks : Ciena (CIEN)

CIEN 200.29

+2.1%

Nov 26 4:00 PM EST

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To: Bald Man from Mars who wrote (3415)	9/21/1998 4:44:00 PM
From: MThree	Read Replies (1) of 12623

I hope so; but I do have some concerns regarding these two potential acquirers: #1 -- CSCO, by and large, avoids acquisitions -- specially large acquisitions --that are not located within Silicon Valley. John Chambers himself said this in an interview with Harvard Business Review in the Feb. or March issue (I believe) of 1997. If Cisco were to make an exception to CIEN, it will only be if it can ascertain that the synergy far outweighs the potential distraction of a large cross-country acquisition. By Cisco standards, this means it will recover the acquisition price in a few years time, by the merger producing exceptional revenue growth (over the next several years) in the company acquired. Can CIEN revenue grow at least 50% per year under Cisco's watch? Is there enough synergy for this? Discussion welcome. #2 -- ASND (who does not seem to mind large cross-country mergers) HAS BEEN PUMMELED TWICE by the market for this(Cascade and Stratus). So I think that if it buys CIEN, it will do so really cheap -- cheaper than CIEN shareholders care to imagine -- since it (ASND) probably expects to get slammed again on any acquisition announcement.

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