What to Do With Agere

Article Excerpt

AGERE SYSTEMS $19.25 (New York symbol AGR; SI Rating: Speculative) (www.agere.com; 610-712-1000; Shares outstanding: 167.7 million; Market cap: $3.2 billion) jumped in price recently after receiving a takeover offer from New York-listed LSI Logic Corporation. LSI is offering 2.16 of its shares for each share of Agere. LSI’s shares were trading for $10.56 a share when it first made the offer, which valued each Agere share at $22.81. However, LSI’s shares have since dropped, and based on today’s price of $9.09 a share for LSI, the offer is now worth $19.63 per Agere share. Agere makes computer chips for storage (35% of sales), mobile wireless (28%) and networking (37%). The company’s chips and software are used in a broad range of computing and communications applications, including cell phones, satellite radios, PCs, PDAs, hard disk drives and gaming devices, as well as networks. We’ll say more as the takeover unfolds, but for now Agere is a hold. hold…

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