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

To: Jonathan C. Williams who wrote (4459)	7/18/1998 3:50:00 PM
From: J Bertrand	Read Replies (2) \| Respond to of 8358

Friends, I think the one thing to keep in mind for Cabletron is that there is an owner (Benson) who thinks the company is worth north of $35 a share. And, he must pay quite a bit more money for the Yago transaction if the stock isn't above $35 a share in about 1 year. Why is this significant? Because he owns a large percentage of CS stock. If the market where imploding and the company didn't have a chance, would the CEO just ride the company into the ground? That isn't rational behavior even if the CEO is an egomaniac. I not saying Mr. Benson is. I am just saying that somebody would have to be completely nuts to let his or her assets just sink into the ground. Therefore, you can only conclude that Mr. Benson is either positioning the company for a sale or he sees Cabletron's world of opportunity differently than we all do. I personally believe that Mr. Benson knows that Cabletron needs to be married to a big teleco. But, since its product line and sales aren't in line with the share price he wants, he must improve the company before he offers it up for sale. If he intends to sell, does anyone honestly think that he is going to let the world know his strategy? Obviously not. The last thing we want our CEO to do is to have a fire sale. At 1.5 billion in revenues, some nice assets such as Spectrum and Yago, and an improved marketplace, Cabletron should get over $35 a share. Jeff Bertrand Bay Networks 2.2 billion in sales gets over 9 billion 4 x sales Cabletron 1.5 billion in sales gets over 6 billion ??? 4 x sales $37.5 a share. Best deal would be Compaq. 500 million+ 1.5 billion in networking contracts nullified= net $25 a share. (Still $37 for shareholders)