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Technology Stocks : Silicon Graphics, Inc. (SGI) -- Ignore unavailable to you. Want to Upgrade?

To: Findit who wrote (9528)	11/6/2001 12:56:46 AM
From: Don Green	Respond to of 14451

NEC Group Seeks Synergy By Acquiring SGI Japan Tuesday, November 6, 2001 TOKYO (Nikkei)--NEC Corp. (6701) and NEC Soft Ltd. (4774) have decided to acquire 60% of the outstanding shares of SGI Japan Ltd. to make the local unit of U.S. computer maker Silicon Graphics Inc. (SGI) a group subsidiary. NEC and SGI Japan will jointly expand business in such areas as high-performance computers for research institutes and building systems for broadband transmission. In an interview with The Nikkei Business Daily, Akinobu Kanasugi, executive vice president of NEC and president of NEC Solutions, talked about NEC's business targets. Excerpts from the interview follow. Q: Could you tell us the details of how the decision to make SGI Japan a subsidiary was made? A: President Norio Izumi of SGI Japan asked us to purchase an equity stake in the company, and the deal was struck in July. NEC and SGI Japan had cooperated in the supercomputer sector and jointly developed broadcasting-related systems for Japan Broadcasting Corp. (NHK). We will take an equity stake in SGI Japan, not because the earnings at SGI in the U.S. have fallen, but because we highly valued the company as a systems developer. Izumi has put SGI Japan on a growth track by shifting its workstation-focused business structure to a structure centering on servers. SGI Japan has also been pushing forward with building systems for broadband. We decided to invest in the company immediately after the offer had been made. NEC initially intended to purchase an equity stake by itself, but we invited NEC Soft to take part in the deal in order to beef up SGI Japan's software development capability. Q: Though you will make SGI Japan a group firm, you will allow it to keep the same board members so it can maintain management independence. Why? A: The SGI brand has become an established name among research and educational institutions. We felt that continuing business as SGI would have a synergistic effect, benefiting NEC. We have decided to have SGI Japan buy from the U.S. SGI the right to use its brand name and intellectual proprietary rights, so that the firm will be able to continue marketing SGI-made computers without being affected by the management conditions of the U.S. firm. Since the earnings of SGI Japan will be included in our consolidated settlement of accounts, NEC's software/service business will consequently expand. We also hope to list the company someday. Q: How will the two companies jointly do business from now on? A: We will cooperate not only in systems building but also in maintenance service: SGI Japan will use NEC's nationwide maintenance service network. We are also considering asking SGI Japan to sell NEC servers equipped with 64-bit microprocessing units of U.S. firm Intel Corp. -- Translated from an article written by Futoshi Kuwamoto, Nikkei staff writer. (The Nikkei Business Daily Tuesday edition)

To: Findit who wrote (9528)	11/6/2001 2:17:14 PM
From: brushwud	Read Replies (1) \| Respond to of 14451

From the rumor article >>There is another source of optimism: SGI is very interested in the G5 for its future workstations. It wants to abandon development of its MIPS line of microprocessors in the near future citing that it can no longer recoup its development costs, and produce a competitively priced UNIX workstation at the same time.<< Yes, that sure sounds like a rumor to me. First of all, SGI no longer has a MIPS line of microprocessors since they spun off MIPS over a year ago. I'm sure there are engineers at SGI who have in interest in all current microprocessors and so it's very possible that MOT has gotten inquiries from SGI, but I'd really doubt that will lead to any business. SGI is already using Intel's Itanium, but they'll probably get checkmated in that market by Dell & HP. If they were smart, they'd use AMD's upcoming 64-bit Hammer series, which will be a lot more economical & mainstream than the Itanium. Even if SGI doesn't, Sun will eventually be forced to go with AMD. MOT's management is actually talking about pulling the plug on its semiconductor division, the former head of which is now president of AMD.