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 : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: Charles R who wrote (17000)	10/31/2000 9:09:11 PM
From: Maverick	Read Replies (1) \| Respond to of 275872

Re: Flash spin-off. Eloquently put Charles ! Perhaps, AMD needs Flash to subsidizes MP in tough times. There is no doubt that the Flash div. by itself is worth AMD's current mkt cap. Flash will have $0.5 B rev by 1Q01. Thats $2B run rate. At current cap of $7B, The Flash is at 3.5X Rev. The rest of AMD is free ! What a steal !

To: Charles R who wrote (17000)	10/31/2000 10:12:54 PM
From: kash johal	Read Replies (1) \| Respond to of 275872

Chuck, Excellent Post. Also if one piece of biz has problems and the other does well the combined companys stock would likely suck big time with the way the market views AMD. I think they may have lost the opportunity to split - earlier this year would have been great. But still it would be a good deal IMHO. regards, Kash

To: Charles R who wrote (17000)	11/1/2000 12:35:09 AM
From: THE WATSONYOUTH	Respond to of 275872

People who have seen me post on this topic know I used to give 3Com and PALM as an example of why splitting off pays - this was before 3Com/PALM split off. I bought COMS in the mid-to-high 20s last year. I got 1 COMS and 1.48 PALM for each of my COMS shares. Today COMS is at ~20 and PALM is at 50+. That is the beauty of unlocking hidden value. If AMD spins off flash now, say, 1 AMD and 1 FLSH for each AMD share, I think the combined value will grow 5 to 10 fold in 1 year. And, I am not being a NiceGuy when I say this. That AMD management is not doing this simple logistics move chagrins me to no end. Good analogy. I also benefited from the Palm spin off. Also, it would have removed Sanders from having any effect on the street's perception of the flash spin off. (Just as the spin off removed the Benhamou effect from Palm) Also, since both the processor and flash business are somewhat cyclical, by separating them, the investor can take better advantage when each is at a peak. Together, if they are somewhat out of phase, the stock price will suffer even if one is doing splendidly well. It is still possible that this spin off could occur. They may be waiting until the processor division gets on a firmer footing (some corporate/server/laptop penetration). We'll see. It certainly was tough seeing the valuation some of those pure flash plays got. THE WATSONYOUTH

To: Charles R who wrote (17000)	11/1/2000 1:39:17 AM
From: Petz	Read Replies (2) \| Respond to of 275872

How to do a flash spinoff? That was a very good post, Chuck. I'm afraid though that if AMD spun off its flash, and Fujitsu did not simultaneously spin off their share, then Fujitsu would just buy out the AMD spinoff during the first down cycle of the flash business. Aside from that, if the AMD spinoff is part of a Fujitsu joint venture, then its PE may be dragged down from what a pure play would get. Therefore, for it really to work, Fujitsu would also have to spin off its share simultaneously. If this took place right now, I would hope that AMD and Fujitsu would retain a percentage ownership, say 20% of the new stock, which they could offer to the public at some future time when flash memory has a higher reputation (i.e., PE) on Wall Street. A $billion cash might come in handy in a couple years. Depending on whether Fab 25 is already running flash, it might make sense to delay such a transaction until AMD really needs both fabs filled to capacity for the CPU business. Petz