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To: Todd D. Wiener who wrote (670)	1/3/1998 8:47:00 PM
From: Sword	Read Replies (1) \| Respond to of 886

Wow! With all of these changes occuring in the effort to integrate analog/digital systems in the electronics industry, we're heading into some exciting times. Thanks for your sharing your thoughts. Jerry

To: Todd D. Wiener who wrote (670)	1/4/1998 10:59:00 PM
From: Jeff Bond	Respond to of 886

Todd, Was Edge acquired at a bargain price, based on the difference between October share prices and those of today? If the acquisition had occurred now, it would involve a lot more shares to compensate for the price difference. I also saw this in the 8K filed October 30th, 1997. >>Affiliates of Edge (to whom 527,909 of the Merger Shares were issued) have agreed not to sell any of their Merger Shares until the Registrant's release of its earnings for its quarter ending November 2, 1997, in order to comply with the pooling requirements.<< It seems to ensure the shares were not sold on the high, and if sold later, at a lower price than may have been originally expected. How does this affect SMTC financially? Is this equivalent to seeing something at the store for $100, determining it is worth $100, then being charged only $60 when you pay for it at the checkout counter? -- Possible M&A Scenarios -- I think you have it right with the M&A possibilities. NSM acquired Cyrix as part of their "system on a chip" strategy. IBM could have acquired Cyrix, but did not need to since they had their designs already, having provided foundry services to them. NMS would benefit by acquiring SMTC, since it allows them to capture a larger market share (they have competing products), it fits well with their commitment to "systems on a chip" and set-top boxes, and they would obtain some of the best analog design engineers. NSM has already shown they are willing to buy the best minds in the business, if it helps them achieve their business goals. The main reason NSM acquired Cyrix was recently some of the most signifigant microprocessor design work lately was coming from this small company, who's nucleus was a group of top notch engineers who left TXN to start their own company. Any M&A discussion involving INTC should revolve around the term "market leader", since execution of their business strategy has been accomplished in such an incredible manner, it reveals management that knows how to win. They are no IBM of the 80's, that is for sure :o) If you missed anyone, it may be "the snake" of the industry HWP, who has a lot at stake and a good deal of involvement in analog devices. Acquiring SMTC is a possibility, since it could help them achieve their goal of manufacturing and selling enterprise-wide servers. HWP manufactures and sells several analog products that would also benfit from this, including test, medical, and other measurement equipment. >>Of course, if this happens, it's likely that INTC will remain the leader, unless they really screw up, like IBM in the 80s.<< This quote is so true, especially since you qualify it with a particular point in time. It is definitely no longer the 80's, this is not the same IBM, and all previous conceptions regarding their bumblings are about as applicable to the new IBM as they are to Intel. IBM may acquire AMD, but acquiring ADI, MXIM, or SMTC is also very possible. It has been a long time since competitors bothered to look over their shoulder and see where IBM was. This would be of no use today, because at this point in time, in so many areas, IBM is so far ahead of the competition. I like IBM for the future, especially if they continue to be led by that ex-tobacco man, someone much sharper than he is given credit for. One other possibility is that SMTC could be acquired by a defense contractor, to support development of products not for public consumption. This is quite possible, given current efforts to substitute live assets with technological equivalents, wherever possible. Regards, JB