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Technology Stocks : Newbridge Networks -- Ignore unavailable to you. Want to Upgrade?

To: Serge Collins who wrote (13680)	10/15/1999 4:17:00 PM
From: gbh	Respond to of 18016

That was the reason in the past, but the SEC has said it will now review those in-process R&D writedowns. It is being much tougher on that sort of writeoff Serge, that's not exactly what they've said. They've said that actually want to disallow pooling of interest, which by its nature allows companies to write in process R&D, beyond what is reasonable. In fact, the SEC can't possibly police this stuff, because they generally have no clue what this kind of R&D really is. In any event, just how much will Newbridge be able to write off? Not enough to make it a legitimate reason for this sort of takeover. I would disagree. The inflated values that companies like STII are bought for (in stock) allow a Newbridge (or a CSCO) to write off to make a difference in a close quarter (perhaps Q4?) and mask reality to some degree. I'm not saying this is the prime motive for the purchase, but certainly one of the benefits. Gary