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

To: Petz who wrote (91047)	2/2/2000 12:02:00 PM
From: Charles R	Respond to of 1573697

Petz, <Ideas like splitting Fab25 between CPU's and flash would be impossible after a spinoff.> This is actually fairly easy. Negotiate a deal before the spin-off on how much capacity in Fab25 will AMD have access to and nail down price and time frames. (AMD/Lattice did something like this with Vantis in 99) Let's see what this would do: - Extremely profitable to shareholders - both business will be valued on their own merits. - Decouples one business from the other. If Flash or CPU biz have tough times it will not effect the valuation of the other business (unless it is a economic downturn that effects cell phones and PCs) - Take Fab25 off AMD balance sheet and makes it much easier to compete with Intel if the industry slows down or if the competition heats up. - Reduces debt - increases long-term competitive position of the company - AMD can focus on just one process (Dresden) and cut process development expenses - Management FOCUS will increase dramatically and they will not be distracted by any other business - Get some additional investment banking exposure. I am sure AMD can get a few top tier guys signed up for a Flash spinoff - that would make some folks believers in the CPU and Flash components of AMD overnite. AMD is anyway thinking of ramping Flash in Fab25 so this spin-off would be in that direction. Chuck

To: Petz who wrote (91047)	2/2/2000 5:10:00 PM
From: tejek	Respond to of 1573697

I agree with greg here. Ideas like splitting Fab25 between CPU's and flash would be impossible after a spinoff. Flash is not very calendar-cyclical, unlike CPU's. A 100% CPU company can hardly avoid having losses at least one quarter out of the year. Petz, I agree...and really its not like AMD has a lot of free time. Everyone is expecting that they continue to gain market share from Intel, increase and assure future profitability, get Dresden firing on all pistons, complete the conversion to .18 and copper, get into the corporate server business, start their own manufacture of chipsets, convince Dell to be an OEM, and last, but not least, spin off the flash business. And all before Q2.....give it a rest AMD shareholders. ted