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Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: Tmoore who wrote (3258)	7/3/1998 9:32:00 PM
From: MGV	Read Replies (1) \| Respond to of 27311

Useful article posted by TMoore - in particular, reconcile this with VLNC: "For achieving thinness, the issue is the battery," said Saied Zangenehpour, senior manager for mobile systems at Gateway, based in North Sioux City, S.D. "Lithium polymer would help because you can shape it to fill any hole in your design. But in my opinion, there will not be any useful supply until late next year." Major players such as NEC, Sony, Sanyo, Matsushita and a number of smaller companies are developing lithium-polymer batteries, but none are ready to commit to volume supplies, he added. Although safety issues with the batteries have largely been addressed, they still cost as much as 25 percent more than lithium-ion batteries and offer 15 percent less energy density." Paragraph 1 - one of the largest potential consumers of laptop batteries, one who is in the thick of difficult competition, looking for every competitive advantage and accustomed to being on top of all issues affecting competition estimates that lithium polymer won't take place until late 1999. Paragraph 2 - among those looking to develop lith poly batteries include deep pockets such as Sony and Matsushita, which leads to the earlier question regarding FMK's wild estimate of $95 M in net profit for a company w/ a market cap of 115 M: If there was any liklihood that FMK's forecast had a probability of being even 1/5 accurate (for 17% 1 year ROI instead of the forecasted 83%), Sony would snap it up in a minute - or with VLNC's dire cash flow requirements to remain solvent, take a large equity stake in VLNC. At best VLNC is in a race with competitors with R&D budgets dwarfing VLNC's in the most liquid of times for VLNC. With its need for cash and a competitive environment that is increasingly cut throat, favorable financing terms are infinitesimally small. Its more likely that the race is over - for VLNC. Otherwise, for $115 M it would have been swallowed.