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Technology Stocks : Lucent Technologies (LU) -- Ignore unavailable to you. Want to Upgrade?

To: Thomas Scharf who wrote (14164)	3/24/2000 4:11:00 PM
From: GVTucker	Read Replies (1) \| Respond to of 21876

Thomas, RE: In essence, failed R&D ends up as losses for the investors in the companies that were not acquired while the acquiring company gets 100% (ideally) successful R&D. Thus, acquired R&D is potentially a much more efficient use of capital. That assumes that the market is highly inefficient in the purchase and sale process. Think about it logically--if a company that is for sale has numerous failed R&D projects, that in turn influences the price of that company. On the flip side, a company with the highly successful R&D will command a higher price, taking away this pseudo 'arbitrage.'