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Technology Stocks : Digital Equipment Corp. (DEC) -- Ignore unavailable to you. Want to Upgrade?

To: rich evans who wrote (2760)	1/21/1998 6:25:00 PM
From: John Sladek	Read Replies (3) \| Respond to of 3276

Rich, I don't know much, but I'm pretty sure that CPQ could not get DEC for $40. Here's several reasons why (in no particular order): 1) The stock is trading above this price - I don't see why DEC would be sold below the current market. 2) It would not be considered to be a fair offer, since DEC has traded higher than $53 in the past year, and more than $50 in the past 3 months. IMO, any takover attempt with a realistic chance of succeeding would have to be at a premium to the 52 week high. (i.e, $60 minimum) 3) Another bidder would come it above that price, If CPQ looked like it was going to steal the company with an opportunistic leveraged buyout at $40, someone else would make a slightly less opportunistic offer at say $45, or DEC could find a white knight, or someone else in the computer business could make a hostile bid. IMO, there are enough players in this very competitive industry to ensure that if DEC is put into play, the shareholders will have a couple of offers to consider. 5) DEC's earnings are recovering, and most investors would hold out for a higher price. Nice try though, Regards, John Sladek.