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Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: Dennis V. who wrote (22264)	11/12/2000 1:08:39 PM
From: Zeev Hed	Read Replies (1) \| Respond to of 27311

I think you are underestimating the importance of these "magnets", a car now contains some 15 minimotors at a very low cost for each, this was enabled by the Nd/Fe-Boron magnets revolutionary technology. It replaced the extremely expensive Sm/Co at much lower price and at least five times the performance. A lot of parallels. The general "rule of thumb" is that the owner of IP should get about 25% of the "economic" benefits derived by the licensee. If you assume after tax profitability in batteries at 20% of sales (an assumption that may not stand the test of reality in this highly competitive and commoditized market segment, particularly if every Asian manufacturer will be able to enter with a license), you get the same 5% royalites. I am sure that the manufacturers will bring a strong argument that their profitability is expected to be "sub par" and not capable of bearing royalties rate in excess of 5%. Zeev