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To: Sword who wrote (671)	1/4/1998 8:33:00 PM
From: Jeff Bond	Respond to of 886

Fairchild electronics finalized the acquisition of Raytheon's Electronic Division last week. Fairchild's acquisition is "intended to offer current customer's better access to mixed-signal and analog devices" per a company press release. That really means they intend to enter the analog market, attempting to secure additional business through new customers. SMTC was SO SMART to have actively pursued and retained the services of he best design engineers available the past two years. This is a classic example of platinum management in action, since it illustrates their foresight to quietly accomplish this two years prior to other companies realizing the potential of the industry. It will be VERY DIFFICULT for ANY new player to catch SMTC (and the few other analog companies) with this kind of head start, especially given the steep learning curve and technical hurdles they will encounter along the way. Jack Poe was an excellent choice as CEO, I wonder who made that decision in the first place? I read that he lives, breathes, and sleep success, and in a hands on and inspiring manner, has earned the respect and dedication of all employees. This is ultimate testament to the fact that the most important business fundamental, more than net profit margin, debt/equity, ROE, earnings growth, or anything for that matter, is VISION. In fact, these other fundamentals are the directly measureable results of management's implementation of their vision. SMTC MANAGEMENT IS PLATINUM, FOLLOWING A CLEARLY DEFINED VISION. The only reason I would bail from SMTC right now is if current management no longer was running the show, either having left or been replaced as a result of an acquisition. SMTC is the kind of company that, regardless of circumstances, will make it's way back to the front of the pack. That makes my decision to long term invest quite an easy one. We'll see where we stand a year from now, or even better yet, three to five years from now! Regards, JB