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

To: Petz who wrote (17028)	11/1/2000 7:30:43 AM
From: hmaly	Respond to of 275872

John, Re..<<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.<<<< John, while spinning off flash maybe best for AMD shareholders in the short run, sometimes we must be careful of what we wish for because it may hurt AMD in the long run. Selling flash will induce more volatility, which normally hurts the stock in the long run. Secondly, if you listen to CNBC, many MM say to buy the market leader. In other words, buy the most dominate in the sector. Just as AMD is starting to get critical mass I believe,splitting AMD into two smaller co. or just splitting the shares could well hurt both share prices in the long run. We should also remember that AMD was selling at triple its current PE just 4-5 months ago. I believe it is way too early to be taking drastic measures during a bear market. Lets not panic now that we seem to be at the cusp.

To: Petz who wrote (17028)	11/1/2000 12:48:59 PM
From: Charles R	Respond to of 275872

Petz, <How to do a flash spinoff? > I don't know how the joint agreement with Fujitsu works but as the saying goes "where there is a will there is a way". <Therefore, for it really to work, Fujitsu would also have to spin off its share simultaneously.> I seriously doubt if Fujitsu would have to spin off its share simultaneously, though. <I would hope that AMD and Fujitsu would retain a percentage ownership, say 20% of the new stock> Given there is some fab sharing going on it makes a lot of sense for AMD to keep some equity in the flash spinoff and also have board membership. A good working approach may be 10:80:10 split between stock offered at IPO, stock spun off to current share holders and stock retained by AMD. <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.> I don't see a reason for that at all. AMD should be able to have agreements similar to what was done with PLD and Telecom spin offs where AMD offers foundry capacity. Chuck