A week of mergers, settlements and possible listings

The news re Computer Associates and the Securities Exchange Commission, EDS`s acquisition of the Feld Group and the Microsoft 'music settlement` dominated the international world of IT and telecommunications last week.

The Nasdaq stock market confirmed last week that it will dual-list stocks.

Paul Booth, MD, Global Research Partners

At home, the Datatec news re its Westcon subsidiary and Altech/NamITech/Labat activity stole much of the local ICT headline space.

Datatec is considering an initial public offering for its subsidiary, Westcon Group, in New York (probably on Nasdaq).

Other local news included:

Esquire Technologies opened a Cape Town branch and Lionel Setshedi was appointed as COO of Elexir.

Furthermore, watch out for the outcome of the proposed merger of NamITech and Altech; the resolution of Orion Telecom`s dispute with Telkom SA; Labat Africa`s possible take-over of Africard; and Altech`s proposed buy-in to Econet Wireless International.

* We saw Siemens cut its stake in Infineon down to about 19%;

* A civil case may be brought by the Securities Exchange Commission against Computer Associates for improper accounting revenues;

* InterActive Group changed its name to Arrowhead Research; and

* Microsoft agreed to modify its software as a direct result of a 'music` dispute.

Additionally, look out for a possible merger between AT&T Wireless and Cingular.

Other international news included:

* The appointments of Mike Dagenais as president and CEO of Optical Solutions, Bruce Freyman as president and COO of Amkor Technology, Jeff Henley as chairman of Oracle, Thomas Oliveri as CEO of Global Payment Technologies, Deirdre Paknad as president and CEO of PSS Systems, Richard Templeton as CEO of Texas Instruments (as from 1 May) and Jonathan Wax as president and CEO of Digital Power;

* the resignations of William Baxter as co-founder and CTO of BSQUARE, Tom Engibous as CEO of Texas Instruments (effective 1 May), Brent Frei as founder and CEO of Onyx Software and Edward Kennedy as president of Tellabs North America;

* the retirement of Doug Dunn as chairman and CEO of ASML (effective late in 2004); and

* a job loss announcement from MCI.

We saw excellent* figures from Integrated Silicon Solution (back in the black) and Yahoo; and very good* numbers from Apple (back in the black), Cree and Faro Technologies.

Good figures* were recorded by Domino Printing Sciences, Exar, Intel, Juniper Networks, Linear Technology, Molex, NetSolve (back in the black), Pace Micro (back in the black), Plantronics, QLogic, Rambus, Samsung Electronics and WebTech Wireless; and satisfactory* figures were posted by Accenture, Digi International (back in the black), Fairchild Semiconductor, IBM, Network Equipment Technologies (back in the black), Optical Cable, Planar Systems and Video Display.

Mediocre* returns came from ASML (but back in the black), infoUSA, Mercury Computer Systems, Nassda, Robocom Systems International and Supertex; while very poor results* came from NetScout Systems (back in the black).

Losses* were posted by Ault, BestNet Comms, Creative Computer Applications, Extreme Networks, Global Payment Technologies, HEI, IceWEB. Oryx Technology, Red Squared, Rediff.com, SofTech, Sun Microsystems, Teradyne, TMSSequoia, Transmeta and Visual Networks.

Other financial news included analyst upgrades for Activision, Applied Micro, Corning, Fair Isaac, Juniper Networks, LTX, Lucent Technologies, PMC-Sierra and Redback Networks; analyst downgrades for PanAmSat, Planar Systems and Veritas Software; a private placement of shares by INSCI; share offerings from MKS Instruments, PalmSource and Research in Motion; a share buy-back announcement from PeopleSoft; a positive results/profit warning from Getronics; and negative results/profit warnings (often veiled) from Eastern Comms, Group 1 Software, Internet Security Systems, Ncipher, Onyx Software, SAP and Tetra Technologies.

There was also a share split announcement from InterActive Group (reverse); a good IPO in China by TCL; a planned IPO on the London Stock Exchange by managed services provider, Phoenix IT Group; possible IPOs by China Netcom in Hong Kong and New York later this year, Chunghwa Picture Tubes in Taiwan and Elpida Memory in Japan; and an IPO filing from chip-making equipment firm Ultra Clean Holdings.

Locally

Aplitec (+28.8%)
Datacentrix (+17.3%)
Dimension Data (+19.2%)
Elexir (+100%)
Global Technology (-33.3%)
Idion (+15.2%)
Sekunjalo (-18.6%)
Sethold (+39.3%)
Vesta (+66.7%)
Zaptronix (-25%)

Internationally

All American Semiconductor (+54.1%)
Applied Imaging (+50.5%)
Applied Microsystems (+66.7%)
Com21 (+122.2%)
Daisytek (+53.8%)
Digital Lightwave (+49.1%)
IDN Telecom (+82%)
Provo International (+40.7%)
Scan-Optics (+53.8%)
SONICblue (+122.2%)

In terms of indices, Nasdaq was up 2.6% and the JSE up 4.1% for the week.

The Nasdaq stock market confirmed last week that it will dual-list stocks, using the same three-letter symbols that were previously only listed on the NYSE. Trading should commence in about a month, and will initially include the following technology companies: Cadence Design Systems and Hewlett-Packard.

* NB

Guidelines for the categorisation of results are as follows and are always in comparison with the equivalent period for the previous year; pro forma numbers are ignored (the terminology may vary slightly from country to country).

* Excellent: Both revenue and net income growth are in excess of 50%.

* Very good: Both revenue and net income growth are in excess of 25%

* Good: Both revenue and net income growth are in excess of 10%.

* Satisfactory: Revenue is within 10% of previous year and net income is up.

* Mediocre: Either revenue and/or net income is down.

* Very poor: Net income is less than 1% of revenue.

* Loss: A loss has been recorded.