James G. Sack (jim) wrote:
OK, I'll bite on that one. I can sorta imaging what it means, but can
you elaborate on 'hostile giveaway'?
(when you get time..)
DEC sued Intel for patent infringement on a bunch of branch prediction
and superscalar stuff. DEC *won*.
However, rather than DEC taking Intel to the cleaners, Intel took DEC to
the cleaners.
It turned out that Robert Palmer (the CEO, not the singer) had marching
orders to return money to the big stockholders by partitioning the
company. Compaq didn't want a fab. Intel didn't want a services
business. So, DEC used the patent infringement leverage to get Intel to
buy the fab and threw in StrongARM (which, of course, Intel promptly
screwed up) for practically nothing (couple hundred million, IIRC). At
that point, Compaq was willing to buy the rest of the business for
something like $4 billion when DEC had almost $3.5 billion in cash in
the bank and a services revenue stream of $1.5 billion a year.
Thus: "hostile giveaway".
I never understood why they just didn't *close the company* and parcel
the money to stockholders. It would have given stockholders *far*
better return.
I'm sure there was something behind the scenes that I didn't see. This
has "pump and dump" written all over it.
-a
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