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Technology Stocks : Dell Technologies Inc.
DELL 133.20+5.7%Nov 26 3:59 PM EST
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To: JRI who wrote (123238)5/7/1999 4:32:00 PM
From: Mohan Marette  Read Replies (2) of 176387
 
Regarding Gateway- John & Paul:

May be you guys are right,I just posted what came to mind at the time but I still don't see how paying Dogway $10-15 billion dollars to get market share in the consumer business mainly in the U.S is justifiable.The last I heard Dogway's sales to the biz segment went down in Europe for Q1,their coverage and business is Asia is not as wide spread as Dell's and I don't know how much business they have in server and other high-end products.It seems like a very costly proposition, besides we don't know how long it will take to digest the acquisition and it may not even work.

Also I don't know how one can increase gross margin by acquiring a higher cost outfit,sure there will be top line growth but what is that going to do.

I rather see Dell spend money in new and emerging businesses rather than acquiring somebody pretty much in the same business,obviously they are not going teach DELL any new business techniques.Now if they were to spend the money in acquiring somebody with complementary products/services such as the storage business or service business it would make more sense I would think or even branch out into other profitable areas of E-Commerce.

Anyway I don't like it a bit, then again I don't run the company and I am not a pundit in the field.However I am an opinionated ass so I had to say something.<vbg>
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