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 : Western Digital (WDC) -- Ignore unavailable to you. Want to Upgrade?

To: Sam Citron who wrote (10673)	7/25/2003 11:13:53 PM
From: Sarmad Y. Hermiz	Read Replies (2) \| Respond to of 11057

Sam, I'm very glad you got interested in WDC. Hopefully, you will be, too - soon. First regarding the cost of the assets. I am sure the $95m is for the Fremont fab, plus an option to acquire the Thailand assembly facility by assuming its debt of $62m. The cost of the fab went up because bidding was re-opened, and apparently it was being raised back and forth with Seagate, et-al. One item that may interest you is that Readrite's plant and equip at end of 2001 were carried at @268m. As far as I know, they have not sold anything since then. And it is not clear to me how much "true" depreciation is. So WDC paid $95m to by $270 m of equip ??? Also, I'm sure that an installed and running plant is worth far more than the price of equipment in crates. Does this make sense ? Maybe Gottfried can advise from his experience. Also, what is the replacement cost of the Thai assembly plant that employs 6500 people and can produce 15 m head assemblies per Q ? I don't know how to compare that except to note that it works out to $10,000 of capital per worker. Is that a good deal for electronics assembly plants ? I'll add more musings in next post. Sarmad