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Technology Stocks : Cabletron Systems (CS: NYSE) -- Ignore unavailable to you. Want to Upgrade?

To: 4-UR-Eyes-Only who wrote (3159)	3/8/1998 3:32:00 PM
From: WTSherman	Read Replies (3) \| Respond to of 8358

<<CPQ is very good at handling mergers. I guess it will complete the DEC integration in less than 10 months.>> This probably belongs on the CPQ thread, but, my feeling is that the DEC situation will overwhelm CPQ management and the reason is the scale of the whole thing. There are an endless number of examples of companies that were good at handling acquisitions and then tried one hugely bigger than any previous and floundered. Maybe the CPQ guys will succeed, but, the odds are not in their favor. The best example I can give of this is the Danka acquisition of Kodak's imaging group. Here was Danka a specialist at acquisitions(they built their whole business on the idea of buying out other company's to grow) and then trying to make an acquisition more than 10x the size of any of the previous. The result? Danka management overwhelmed by the scope of issues they faced, stretched too thin, other parts of the business getting lost and eventually an almost complete breakdown of the company. One thing is for sure, the last thing they would need is to add a third tier company like CS to this mix. If CS is going to salvage itself it will need to find an effective partner, soon. The more time goes on the worse their prospects will become.