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Technology Stocks : CRUS, good buy? -- Ignore unavailable to you. Want to Upgrade?

To: Walter R. Roche who wrote (5829)	5/13/1998 1:52:00 PM
From: Grand Poobah	Respond to of 8193

MiCRUS ownership is split 52-48 between IBM and CRUS. IBM and CRUS pay for the equipment and other costs. IBM Microelectronics provided/provides the process expertise and patents. IBM and CRUS get wafers from MiCRUS under pre-arranged agreements, but basically they get the wafers at cost. So there are no profits for MiCRUS per se. In fact, based on the fact that CRUS made $53m in charges for overcapacity for the coming year, they are probably still losing money on the deal at this point. I think the Top Fab award was given based on the fact that they have turned MiCRUS around from closing up the doors to being a world-class fab and the fact that they have advanced from 0.8-micron to 0.35-micron process technology in the span of a few years. I don't think it had much to do with profitability or yields or subtle complexities of the processes since these things are proprietary and wouldn't have been available for examination by Semiconductor International. G.P.