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To: Bill Harmond who wrote (81451)	10/21/1999 2:27:00 AM
From: H James Morris	Respond to of 164684

William, High horse? I've felt so crappy this week. I'd say it would be more of a low horse. Did you know that AOL owns a 20% interest in TMF, so maybe their statements are a little biased? Did you or anyone else here catch this one? I missed this one completely. Is this another Cisco? >> Austin, Texas, Oct. 20 (Bloomberg) -- Crossroads Systems Inc., which makes devices for high speed storage and retrieval of data from different storage systems, more than quadrupled in its first day of trading. The Austin, Texas-based company rose 64 to 82 as about 10 million shares changed hands in late trading. Earlier, the shares went as high as 85 13/16, giving the company a market value of $2.20 billion. There is a ``big, growing market for storage area networks (and) routers are a key component,' said Clinton Morrison, an analyst with John G. Kinnard & Co., a Minneapolis-based securities firm. ``Crossroads is clearly recognized as the leader in routers for this marketplace.' Crossroads said its routers help organizations store larger amounts of data and transfer it more efficiently than traditional computer networks in which each storage device is connected to just one server. Storage area networks -- or SANs -- are expected to become increasingly important as companies spread out their computer systems over the Internet. Crossroads said in documents filed with the U.S. Securities and Exchange Commission its routers decrease network congestion, reduce the time required to back up data and make for more efficient use of storage. There has been ``a lot of hype about SANs, but it's finally starting to move,' said Michael Geran an analyst at the Pershing division of Donaldson Lufkin & Jenrette Securities Corp. Emulex, QLogic Before Crossroads' sale, Emulex Corp. and QLogic Corp., two Costa Mesa, California-based companies that make products for storage area networks, soared as investors decided the technology was important, Geran said. Emulex is up 554 percent this year and Qlogic is up 148 percent. Crossroads Systems says it has sold approximately 6,000 of its storage routers through computer makers such as Compaq Computer Corp. and Hewlett-Packard Co. It lost $3.6 million on revenue of $11.8 million in the nine months ended July 31. It lost $3.8 on revenue of $2 million in the same period a year earlier. The company said it expects to use about three-fourths of the IPO proceeds for working capital, with the remainder divided between capital spending, marketing and product development. Crossroads Systems yesterday sold 3.75 million shares, a 15 percent stake, at $18 each to raise $67.5 million. The share price was $2 above the top of the $14 to $16 range set before the sale by SG Cowen Securities, which handled the offering. Chief Executive and Chairman Brian R. Smith, 34, started Crossroads in 1995 with T. Dale Quisenberry, 40, who is now the vice president of corporate accounts. Smith, holds a 18.4 percent stake in the company following the IPO; Quisenbery holds a 4.6 stake. Management Smith previously held various management positions at IBM, where he led the development of IBM's fiber channel technology, the company said. President James Moore, 61, worked previously at Cirrus Logic Inc. a chip manufacturer. He holds a 2.5 percent stake in the company following the IPO. Board member and venture capitalist William Wood, 43, holds a 24.2 percent stake following the IPO. Crossroads trades under the symbol ``CRDS' on the Nasdaq Stock Market. Dain Rauscher Wessels and Morgan Keegan & Co. helped with the sale. Oct/20/1999 15:54 <<