Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : LHSP: Lernout En Hauspie -- Ignore unavailable to you. Want to Upgrade?

To: unclewest who wrote (2265)	8/9/2000 10:25:04 AM
From: the dodger	Read Replies (2) \| Respond to of 2467

Hiya UW, nice to see a G&ker over here 'slumming' <G>... I invite everyone to entertain this thought for a sec... Suppose that the WSJ article wasn't a hatchet job. And further suppose EVERY word in it was true. What would that mean? 1. Would it mean that Bastiaens lied, misinformed, or exaggerated certain facts to a WSJ reporter? Answer: YES 2. But does that mean that L&H is guilty of "accounting irregularities"? Answer: NO -- and not by a long shot. I'm an LHSP "long", and I've now had the displeasure of hearing CEO Gaston Bastaiens speak on TV 3 times now...and let me assure you, it's not a pretty thing to watch -- he definitely lacks the charm and charisma of say AT&T's Michael Armstrong. First, he doesn't look "well-groomed". To put it politely, he could definitely use a new tailor & barber. Secondly, and especially for someone in the communications business, he's not what I would call "glib". (But then, I wonder just how glib any of us would be, trying to defend our respective employers on TV in Belgium while speaking French <g>) And Gaston does tend to ramble a bit -- and at times, almost incoherantly. And like it or not -- appearance is important -- and sometimes it's everything. (Right now I'm thinking of the photo of Dukakis sitting in that tank wearing that silly-looking helmet during the 1988 presidential elections.) The point is, it's obvious that L&H brought Gaston in to run the company based on his technical knowledge & abilities, and NOT on his abilities to "crunch numbers" or speak in public to an American audience. But please remember, he is the CEO -- and not the CFO. A few months ago -- following an attack by Herb Greenberg -- I decided it might be wise to take some time and read up a bit on Bastiaens background. In short, the man is definitely from the "technical" side of the tracks. He has spent the majority of his career working on or leading projects involving translation-related software. Remember the "Newton"? -- it was e-tablet (developed by Apple in the mid-eighties?) that you could write on with an electronic pen, and the software translated the hand-written cursive into a computer text font. Bastiaens was the project manager that made it work. Was it commercially viable product? No -- but that was a marketing problem. And when L&H brought GB in as CEO, I'm sure it was not done blindly. Gaston had been the CEO of Quarterdek -- and L&H had business dealings with them. (I wish I could reference that for you, but I can't remember the link.) You would have to assume that if L&H thought Bastiaens was in any way responsible for Quarterdek's demise, they would never have appointed him to run their company. (And from what I could gather off "the net" it sounded more like MSFT crushed them.) So just what does that WSJ article mean? To me, it means that L&H has a PR problem. And yesterday proved that that's no small matter. But just because GB put out some bad information to a reporter does NOT mean he walked into their accounting office and "fudged the numbers". I suspect that wen the truth is finally known, it will probably be quite the opposite. Because everybody on Wall Street, their auditors, and every L&H investor, has been anxiously awaiting a chance to scrutinize those 2nd Q financials -- and specifically -- the demographics of their revenue. And Gaston has known this for at least 35 days. (Greenberg first raised the "Korean" question on July 5th) To try to get by "bloating" their revenue stream right now would be like trying to hide a pig in a python -- there's just too many eyes focused on the situation for any sane person to think they could get by with that. And I've asked this question in a recent post, but I think it bears repeating... "If you were the CEO of L&H, and given the recent concerns of the investment community, how would you have spent these last 35 days?" Really...think about that for a second... I know what my #1 priority would have been...making sure that my 2nd Q financials were absolutely squeeky-clean -- and especially any part of the ledger that might involve my Korean business. To do otherwise would be corporate suicide. Isn't that what you would have done? And I have no reason to suspect that Bastaiens would behave any differently than you or me-- and that's just common sense. My conclusion is, L&H is quilty -- but not of "accounting irregularities", but rather of needing to appoint a polished, well-spoken PR person -- and especially for the American audience. Not having one cost them a billion+ bucks yesterday in market-cap. td