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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Mike Buckley who wrote (7650)	10/6/1999 10:48:00 AM
From: StockHawk	Respond to of 54805

Mike, I agree with you, and I'm sure you realize my comment was an observation, not the end result of a detailed financial analysis. Obviously, a combined company is different from a pre-merger entity in all cases, and a host of factors must be considered. A quick sample would include: -problem of integrating different cultures, different leadership styles, territory realignment, reporting responsibilities, computer and financial systems, etc. -opportunities for synergies, functional and geographic overlap/conflicts -how to handle key customers, relationship management -differing salary structures/personnel policies -differing growth histories/strategies/goals -larger company, more revenues, greater market cap, more debt, etc. Such items are not digested and sufficiently analyzed by the merged companies themselves (look at how many mergers run into trouble) let alone individual investors a few days/hours after an announcement. What I am suggesting, however, is that this combination - if it goes through - has some unique aspects in terms of the competitive situation for these two companies. GMST's opportunities have been mentioned here by others, but always tempered by the legal issues of a single formidable competitor. It is highly unlikely that any trial or settlement outcome would have given GMST the market clout they will have now as a result of this combination. Yes, short term, GMST's growth rate/profit margins will likely be reduced, but long term, based on the limited information I have seen so far, I think their position will be formidable, their gorilla-potential significantly enhanced. IMHO, this is not a nimble high-flying QWST buying a stoggy, low-growth telco. This is a JDSU-like smart combination that will result in a dynamic company with incredible market-share and diminished competitive threats. (Now let me go catch up on the 100+ posts I've missed since last night <g>. StockHawk