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To: Johnny Canuck who wrote (38922)	2/27/2003 10:45:52 AM
From: j g cordes	Read Replies (2) \| Respond to of 71209

Current new positions this morning HGSI in at 6.4, CIEN new at 5.25, TLAB new at 5.89 All, TA basing patterns or oversold with vacuum above Chicken trades if reversed, longer term if they hold as each has more substance than reflected in price imho.

To: Johnny Canuck who wrote (38922)	3/5/2003 1:40:58 AM
From: Johnny Canuck	Read Replies (1) \| Respond to of 71209

UTStarcom Expands Outside China With Acquisition Tuesday March 4, 11:23 pm ET Dow Jones Business News BEIJING (Dow Jones)--UTStarcom Inc. said Tuesday it will gain access to new customers and markets outside of China with its deal to buy part of the telecom-equipment business of 3Com Corp. (NasdaqNM:COMS - News) . ADVERTISEMENT UTStarcom is based in Alameda, Calif. but its main business has long been supplying telecom equipment to operators in mainland China. While it has made sales in other markets in Asia and South America in recent years, executives said the acquisition - the company's first - will give it access to European and North American customers it hasn't been able to crack before. "We now open ourselves to the AT&T, Verizon, Sprint type market, which we had a very difficult time penetrating before," Chief Executive Hong Lu said in a conference call after the agreement was announced. Under the deal, UTStarcom will pay $100 million in cash for some assets of 3Com's CommWorks business, including several product lines and a global service and support business. The agreement has been approved by both companies' boards, and subject to regulatory approval, is expected to close in the second quarter of 2003. UTStarcom expects a one-time charge of $8 million to $12 million in the second quarter for the transaction. But after that, the new business is forecast to contribute an extra $25 million to $30 million to UTStarcom's revenue in each of the remaining quarters of 2003, growing to an additional $30 million to $35 million a quarter in 2004. The purchase is expected to be earnings neutral in the third quarter of 2003 and mildly accretive in the fourth. "CommWorks has a significant presence in North America, Europe, Latin America and Australia. This diversification will increase our pro forma non-China revenues from approximately 25% to between 30% and 35% in 2003," Chief Financial Officer Michael Sophie said in a conference call. UTStarcom's net earnings reached $107.8 million on revenue of $981.8 million in 2002. Last year, 84% of the company's revenue came from the mainland, down slightly from 90% in 2001. UTStarcom had previously said it would fall to 75% in 2003, and has a target to cut it to 50% by the end of 2006. Sophie also noted that CommWorks's services arm contributes about half of the business's overall revenue. "(It will) provide us with a revenue opportunity that until now we have been unable to exploit," he said. UTStarcom could also eventually transfer manufacturing of some CommWorks products to its own facilities in China, in order to take advantage of the lower costs there. However, it said it had no short-term plans for that. "We do see great potential for us to reduce cost on the manufacturing side," said CEO Lu. "We're not going to do that immediately. We want to make sure we maintain current product flow." -By Andrew Batson, Dow Jones Newswires; 8610 6588-5848; andrew.batson@dowjones.com -Edited by Timothy Gan