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To: The Phoenix who wrote (6682)	6/18/1998 9:33:00 PM
From: The BayWatcher	Respond to of 6980

More takeover news from Wall Street Journal Interactive: 3Com, Ascend Shares Up On Rumors Of Takeover By Ericsson NEW YORK (Dow Jones)--Shares of 3Com Corp. (COMS) and Ascend Communications Inc. (ASND) were up Thursday on ongoing rumors that Swedish telecommunications equipment maker L.M. Ericsson Telephone Co. (ERICY) could acquire one of the data networking companies. Rumors of acquisitions in the computer networking companies by the big phone equipment companies have been sweeping the sector for a number of months and heated up this week after Northern Telecom Ltd. (NT) finally announced its long-anticipated purchase of Bay Networks Inc. (BAY). That deal itself has attracted a lot of criticism on Wall Street and some have speculated that it could unravel or that another suitor - including possibly Ericsson or Lucent Technologies Inc. (LU) - could still make a run at Bay Networks. Several analysts maintained, however, they would be very surprised if the deal between Nortel and Bay Networks fell apart. Officials at Ascend and Bay Networks declined comment, while Northern Telecom, 3Com and Ericsson couldn't be immediately reached for comment. Shares of 3Com were recently up 2 1/4, or 9.1%, at 26 7/8 on Nasdaq volume of 11.2 million compared with an average daily volume of 6.9 million. Ascend's shares were recently up 1 5/8, or 3.3%, at 51 on Nasdaq volume of 7.9 million compared with an average daily volume of 7 million. Ericsson's shares were down 1 9/16, or 5.7%, at 25 7/8 on Nasdaq volume of 6.8 million compared with an average daily volume of 4.2 million. Bay Networks, meanwhile, was up 3/16, or 0.6%, at 30 3/16. And Nortel was up 1/2, or 1%, at 53. Wall Street has heaped criticism on Northern Telecom for its deal with Bay Networks over the past week, which has led to rumors the deal may fall apart. Some have charged the purchase of Bay Networks wouldn't give Nortel a strong enough product offering to be a leading supplier of equipment needed to build out the Internet. Bay Networks, for instance, does have some routing offerings, but doesn't have a big carrier-class router product. In addition, many have questioned Bay Networks' ability to effectively compete with the giant of the networking industry, Cisco Systems Inc. (CSCO) - particularly since Bay Networks' last quarterly results were a disappointment. The deal also has been criticized because it will be dilutive to Nortel's 1998 earnings. One analyst said the company would have to realize $700 million in synergies to make the transaction accretive in 1999. These concerns helped drive Nortel's shares down nearly 10 points to 54 on the day the acquisition was announced. One analyst noted that Nortel has therefore probably been facing pressure from its larger shareholders to terminate the deal. But Sanford C. Bernstein & Co. analyst Paul Sagawa believes Nortel is buying Bay Networks for a bargain. The deal calls for each Bay Networks shareholder to receive 0.6 of a Northern Telecom common share. Sagawa believes the low price at which Bay Networks sold out is therefore either a sign that Bay Networks' "quarter is in trouble and this is the best option" or - more likely - the best deal Bay Networks could get to preserve power of its own management. "It's a sweetheart deal for management," he said. Sagawa therefore sees the possibility of a bidding war for Bay Networks and maintained that Bay Networks, along with Ascend, is one of the only "real plums" in the data networking industry right now. He noted that Ericsson, for one, could be interested since it already distributes some Bay Networks equipment in Europe. In fact, according to documents filed with the Securities & Exchange Commission Thursday, Bay Networks could pay a walk-away price of $275 million to terminate the Nortel deal. Several analysts maintained, however, that they would be surprised if the deal with Nortel fell apart. For one thing, one arbitrageur noted that Bay Networks was widely shopped around, so it is unlikely that another suitor would come out of the woodwork now. He added that he doubts any company would be interested in Bay Networks following the reaction that Nortel has received. In addition, one analyst noted that the stocks of Nortel and Bay Networks are trading pretty much in line with each other under the terms of the exchange ratio - a sign that Wall Street generally expects the deal to go through. Meanwhile, looking at the rumors that Ericsson could make a bid for 3Com or Ascend, several sources agreed that a pairing with Ascend would make more sense since both Ascend and Ericsson are focused on the carrier market. And Sagawa noted that 3Com's modem and adapter card businesses would not be very attractive to a telecommunications equipment supplier since they are commodity-like, low-margins operations. Sagawa added, though, that he believes Ascend might be interested in waiting for Lucent, which will be free to do pooling of interest transactions in October. "Ascend is the next to go," the arbitrageur said. -Joelle Tessler; 201-938-5285

To: The Phoenix who wrote (6682)	6/18/1998 9:44:00 PM
From: Matt Quigley	Read Replies (1) \| Respond to of 6980

Micom part of NT has had voice over IP long before Cisco. micom.com

To: The Phoenix who wrote (6682)	6/18/1998 9:52:00 PM
From: StockMan	Read Replies (1) \| Respond to of 6980

Gary, As usual, you start blabbering without reading or thinking. Circuit switched voice, and VoIP will co-exist. Providing an integrated solution will be the task. NT now has both. That is why Chambers tried to partner with NT and LU and FAILED -- because he need the circuit-switched voice. In a couple of years, NT and LU will be the complete solution providers in the carrier space, and Cisco will be selling routers. Stockman