Intel CEO Craig Barrett Files to Sell One-Third of His Holdings
Bloomberg News
October 21, 1998, 11:19 a.m. PT
Intel CEO Craig Barrett Files to Sell One-Third of His Holdings
Washington, Oct. 21 (Bloomberg) -- Intel Corp. Chief
Executive Craig Barrett disclosed plans to sell one-third of his
company stake, or 700,000 shares, as the world's largest computer
chipmaker's shares recover from a slump earlier this month.
Three other company insiders also have filed with the U.S.
Securities and Exchange Commission during the past week to sell a
combined 110,000 shares in Intel, according to the Washington
Service, which tracks insider buying and selling.
The proposed sales come as Intel shares are down about 10
percent from this year's high of 95 5/8, and are notable for
Intel insiders, who until late last year usually sold stock when
Intel shares reached all-time highs, said Paul Elliott, a
research analyst with CDA Investnet, a Rockville, Maryland firm
that tracks insider buying and selling.
This year, sales ''have come through on every rally, which
to us is kind of a curious behavior. It shows a little bit of a
lack of confidence that that rally is going to be sustained,''
Elliott said.
Barrett, who became CEO in May, has sold shares five other
times over the past six years, according to Washington Service.
After the proposed sale, he still would hold stock and options
equivalent to 1.45 million shares.
Intel spokesman Chuck Mulloy said Barrett's planned sale
represents options ''due to expire soon, within the next few
months.'' Barrett's sale could garner about $59.2 million, based
on yesterday's closing share price of 84 9/16. Intel shares rose
1 5/8 in recent trading to 86 3/16.
Competition
Santa Clara, California-based Intel on Monday bought Shiva
Corp., a maker of networking products, as part of a strategy to
move into computer networking for small companies and home
offices, as its main chip business slows. Networking gear, such
as network interface cards, are expected to be one of the fastest-
growing parts of the networking market.
Still, amid competition with 3Com Corp., Intel last month
cut prices in its computer-networking products for small
businesses by as much as 49 percent. In the broader computer chip
market, Intel faces competition from the likes of Advanced Micro
Devices Inc., which is seeking to deliver chips with capabilities
similar to Intel's at lower prices.
In addition, the company must contend with economic turmoil
in the Asia Pacific region, where sales stagnated even as Intel
reported record global sales for the third quarter.
More Insider Sales
Paul Otellini, executive vice president, plans to sell
64,696 shares, or 15 percent of his holdings, according to
regulatory filings gathered by Washington Service. After the sale
is completed, Otellini will hold 378,552 shares in the form of
stock and options. That figure includes 32,000 options Otellini
was awarded this year and an earlier sale of 62,000 shares.
Gerhard Parker, another executive vice president, plans to
sell 40,000 shares, or 7 percent of his holdings. Parker will
hold 530,182 shares in the form of stock and options after the
sale. He's sold 150,000 shares so far this year, according to
data compiled by Washington Service, and received options equal
to 32,000 shares.
Otellini and Parker, like many high-tech executives who are
compensated in stock options, have routinely sold company shares
in past years. What's different is the timing of the sales, said
CDA Investment's Elliott.
''We have noted a distinct shift in the insider profile at
Intel Corp., as executives who held on to their shares when the
stock climbed to all-time highs started selling shares at prices
off the highs in the fall of '97,'' according to a report by CDA
Investnet released in August 1998.
Charles Young, an Intel director and chancellor of the
University of California at Los Angeles, disclosed plans to sell
5,000 shares. He now holds 30,900 shares, according to Intel's
most recent proxy statement.
--Siobhan Hughes in Washington (202) 624-1943 and Molly Williams
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