To: Rocky Reid who wrote (7506 ) 11/17/1998 11:05:00 PM From: Dale Stempson Read Replies (1) | Respond to
So, from today's press release we see that SyQuest is selling: patents, intellectual property, equipment and inventory.Patents and intellectual property - I imagine that they could make use of SyQuest's patents to perhaps improve and/or lower costs on new or existing products. Also valuable would be instant resolution of the various legal cases between SyQuest, Iomega and Nomai. In addition, Iomega might be able to pursue SyQuest's case against Castlewood. With their resources, they might be able to put Castlewood in a real bind.Equipment - I imagine the disk related equipment could be immediately used by Nomai for making SparQ and SyJet disks. Perhaps Iomega could/would make use of most/all the drive equipment in their new facility.Inventory - Disk inventory could be marketed by Nomai. Finished goods drive inventory could sold and remaining WIP and component inventory could be used to support warranty repairs and replacements.A/R and Penang building - If memory serves, these assets were used to secure existing credit lines and thus it would make sense that they would not be included in the purchase since Iomega would not be interested in buying the whole company.Support and warranty service - If Iomega/Nomai were to begin making SparQ and SyJet disks, it would make sense for them to take this over. The note about SyQuest using some of the purchase price to cover these issues may be actually be a way of reducing Iomega's out of pocket expense.
