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Technology Stocks : Cabletron Systems (CS: NYSE) -- Ignore unavailable to you. Want to Upgrade?

To: dav who wrote (7598)	2/10/2000 5:21:00 PM
From: kennbill	Read Replies (1) \| Respond to of 8358

I believe that's the stated intent. But the PR says they will first separate them into 4 independent subs of CS before they are spun-off one at a time. Shareholders will get shares in the new companies proportionate to their holdings in CS. But my guess is that they will sell off one or more of the divisions before they are spun-off...the history here seems to be get bigger or get out.. I can't see 4 small companies competing when CS may not have been able to.. JMHO..

To: dav who wrote (7598)	2/10/2000 9:01:00 PM
From: Ingenious	Respond to of 8358

the outcome of this for current investors would more than likely be that they become quasi-vcs for 4 different startup companies. each shareholder vis a vis the management of cs and money in cs, funds the ipo of each company and in return for the capital provided receives a portion of the company in the form of certain shares. each company then separates from cs with a bit of intellectual property, some good will, employees, (etc. and all the other ingredients it takes to run a business- something not all startupes even typically have) less a percent of their company. this is something like att spinning off lucent many years back. then, each individual company is free to do business the way they see fit with the people and organization best suited for the business. cs shareholders may not get shares directly but will benefit from each of the ipos in the form of increased assets and possible an increase in revenue stream due to royalties from intellectual property and/or synergies in the sale of the subsidiaries products (that just happened to work well with the other spin offs products. of course, this is just one scenario and many others are possible.