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Technology Stocks : Newbridge Networks -- Ignore unavailable to you. Want to Upgrade?

To: Doug who wrote (10154)	3/9/1999 1:10:00 AM
From: pat mudge	Read Replies (1) \| Respond to of 18016

Doug --- Somewhere along the way, the debate shifted from deciding which company had more at stake in the alliance to which company's stock would be more affected should it fail. I readily concede the stock issue --- I doubt either company considers short-term fluctuations when negotiating technology critical to its long-term health --- and stand my ground on the strategic importance of NN's products. Tomorrow's Financial Times has it right: <<<< Europe March 9 1999 SIEMENS: Company to exploit US ambition By Richard Waters in New York Siemens expects to acquire more small US technology companies and create a US salesforce of several hundred people in its effort to establish a presence in the fast-growing data network equipment business, it emerged yesterday. The German company, as expected, became the latest European telecommunications equipment maker to unveil its strategy for breaking into a business dominated by American companies - though its plans are more cautious than those of its French rival, Alcatel, which last week announced two deals worth a total of more than $2bn. Yesterday's announcement, which included the purchase of two small US technology companies and an equity investment in a third for a total of about $600m, will also involve a psychologically important shift away from Siemens' home base. The company had decided to site its worldwide data networking headquarters on the fringes of Boston because of the more advanced technological base and stronger entrepreneurial drive than existed in Europe, said Tony Maher, a Siemens director. "That's the place where the heart is beating right now," he added. Mr Maher added that Siemens hoped the new US unit, called Unisphere Solutions, would help to transform the culture of the whole group. "The fact that we are doing this means that we are starting to think differently," he said. Like other traditional telecoms equipment makers, Siemens was caught out by the speed of the technological revolution that has seen carriers rush to build new, internet-based networks. Argon Networks and Castle Networks, the Massachusetts-based companies Siemens is to acquire, and Accelerated Networks, a Californian company it has taken an equity stake in, make different components for data networks. These companies will be combined with Siemens' own telecoms and networking operations in Florida, California and Ottawa to create the new Unisphere Solutions subsidiary. Siemens is also relying heavily on alliances with 3Com and Newbridge Networks to round out the range of equipment and services it can sell and give it a sales network in the US. The new business will begin with annual revenues of $200m and 500 employees, making it a minnow compared with the industry leaders such as Cisco Systems, which had revenues of $8.5bn last year. Other telecoms makers placed bigger up-front bets on the data networking business, including Lucent Technologies, which paid $19.3bn for Ascend, and Nortel, which paid $7bn to acquire Bay Networks. Siemens said it had earmarked $1bn to back its new US venture, with the remaining $400m or so to support further investments. >>>>

To: Doug who wrote (10154)	3/9/1999 1:52:00 AM
From: Maple Leaf	Read Replies (1) \| Respond to of 18016

<<If there is a further decline in sales thru Siemens and that sales is not compensated for, NN will be mauled .Siemens will at worst be grazed lightly.>> Doug, Am I missing something here? Sales through Siemens were 19%this qtr. vs.14-15% last. Assuming revenues were flat is that not an increase in sales through that channel? I guess what I'm getting at is the only reason we're discussing this is someone at Seimens or in the Media was wrong. Alan Lutz said in one of the last 2 C.C.s the relationship has never been stronger and with the increase in sales I'd take his word before something someone at Seimens said in the paper. Now how's this for a senario (this is all speculation based on no fact whatsoever).If both Seimens and Newbridge are a little light on the I.P. side of things and they're both buying companies in the Boston area,does it seem a stretch of the imagination that they would merge the 2 operations to form a subsidiary owned by both with product sold by both? Now that would be a strengthening of the relationship. F.W.I.W. Ray