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Strategies & Market Trends : The Thread Formerly Known as No Rest For The Wicked -- Ignore unavailable to you. Want to Upgrade?

To: QuietWon who wrote (19017)	3/22/1999 11:19:00 PM
From: Tim Luke	Read Replies (3) \| Respond to of 90042

BLOOMBERG::: ; ; ; ; ;Fore Rises 9.9% on Speculation It May Be Acquired (Update1) Fore Rises 9.9% on Speculation It May Be Acquired (Update1) (Updates with closing share prices.) Pittsburgh, March 22 (Bloomberg) -- Fore Systems Inc. shares rose 9.9 percent amid speculation that it may be the next computer-networking company to be bought for a premium by a large telephone-equipment maker such as Ericsson AB. Fore rose 1 11/16 to 18 11/16 in trading of 16.7 million. It was the fourth-most active in U.S. markets for a second day, after gaining 17 percent Friday. Ericsson American depositary receipts fell 5/8 to 22 5/16 today. Stockholm-based Ericsson wants to add networking products to keep pace with rivals Siemens AG and Alcatel SA, which have been on buying sprees to acquire Internet gear as sales of traditional phone equipment slow. Buying Fore would give Ericsson U.S. customers and the so-called asynchronous transfer mode, or ATM, switches used to combine voice and data on phone networks. ''Fore has critical technology that companies like Ericsson need,'' said Scott Heritage, an analyst with Warburg Dillon Read who rates Fore ''hold.'' A spokesman for Fore declined comment on the takeover speculation, citing company policy. Ericsson officials weren't immediately available. On Friday, Ericsson spokeswoman Kathy Egan said that ''we certainly are looking'' for data-networking companies. Fore May Be Next Aside from No. 1 computer networking company Cisco Systems Inc., No. 2 3Com Corp. and No. 4 Cabletron Systems Inc. -- all of which are many times Fore's size -- Fore is among the last of the independent networking-equipment makers. Xylan Corp., Ascend Communications Inc. and Bay Networks Inc. all agreed to be bought for substantial premiums during the last seven months. ''It's just a matter of time before Fore is taken out,'' said Heritage, who expects Fore will be purchased for a premium similar to the 37 percent paid by Alcatel for Xylan on March 2. Ericsson officials have said they're looking to make more data-networking acquisitions after the company bought Advanced Computer Communications, known as ACC, in November for $285 million. ACC makes gear used by phone companies to route Internet calls. On Feb. 26, Fore's shares fell 16 percent after the No. 7 networking-equipment maker said sales in the fourth quarter ending March 31 were lagging forecasts, prompting concern that earnings may miss estimates. Fore, which is being hurt by slowing corporate sales and stiff competition from Cisco, is expected to earn 12 cents a share in the fourth quarter, the average estimate of analysts polled by First Call Corp. NYSE/AMEX delayed 20 min. NASDAQ delayed 15 min.