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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Paul Engel who wrote (69399)	8/21/1999 12:41:00 AM
From: kash johal	Read Replies (1) \| Respond to of 1573092

Paul, Re:"" I hear AMD selling off most of Fab 25 and flash biz plus fujitsu JV for the $2-2.5Bn range." Please explain what you mean by this." First of all this won't happen tomorrow but Q2 2000 when AMD has Dresden all ramped up to reasonable volumes. AMD is reviewing all of its strategic options IMHO. They will either raise more funds via equity or asset sale. The only asset of any major value is the flash biz. Its possible this business tanks again and may become worthless. However forecasts are for enormous flash growth for next 3-4 years. They have FASL 2 which is ramping up and should enable sales to reach 250-300/Qtr. In addition it is not clear that they definately need all of fab 25 once fab 30 gets up to speed. I understand that Fab 25 would be easy to convert to AMD flash by end of next year and a 0.18 Flash capable fab is state of the art. As u know Dresden has space for several fabs and by mid next year they will need to committ to next fab area for 0.1 micron for year 2002 production. Clearly they cannot keep investing in Flash and CPU's so thats whats driving the strategic reviews. And they are so debt laden that significant money will come thru an asset sale or equity placement not debt. If the stock stays in the $20 range then an asset sale is likely. If they can get stock to $30-40 range then I can see an equity deal with an IBM/CPQ/Siemens/Motorola??? regards, Kash