Siebel Systems (SEBL) - strong buy? Message Board

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Technology Stocks : Siebel Systems (SEBL) - strong buy?

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To: Melissa McAuliffe who wrote (2136)	10/13/1998 6:37:00 PM
From: j_b	Read Replies (3) of 6974

<<I wonder if PSFT isn't making a mistake by not acquiring one of these companies vs. this partnering thing they're doing. >> Interesting concept, but I would think the potential customers of a front-end product would think twice about purchasing a Siebel product if it was too tightly associated with one back office vendor (if it wasn't the one the potential customer was using, or if they felt that it would limit their future ability to change back office packages). It would decrease the value of Siebel overall, making the acquisition a bad deal unless they could adjust the valuation of Siebel to match (unlikely to be accepted by SEBL shareholders). By partnering, they extend the utility of their own product, without having to pay a premium for the front end product that would take 5-10 years to recoup. If this was a build versus buy decision, I would agree with you. The reduced time to market, the existing market share, the goodwill, etc. would justify paying the premium.

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