Conference nyoss1::market_investing

912.0. "Networking (remote access in particular) is a hot place to be" by LAVC::CAHILL (Jim Cahill) Wed Sep 06 1995 21:42

 Bay Networks Sets Deal to Acquire
 Xylogics in $330 Million Stock Swap

 A Money & Investing Update News Roundup 

 Bay Networks Inc. agreed to acquire Xylogics Inc. in a stock swap it
 valued at $330 million, sending Xylogics shares soaring. 

 Bay, a computer-networking products concern that was formed in a 1994
 merger of Wellfleet Communications Inc. and SynOptics Communications
 Inc., said it would swap 1.05 shares of its common stock for each share
 outstanding of Xylogics, a computer-networking concern based in
 Burlington, Mass. 

 Xylogics shares jumped on the news, gaining $11.875 to 48.875. Bay
 shares slid $1.375 to $48.875. 

 Bay said acquisition would help it plug several gaps in its product line. The
 purchase will rapidly launch the company into the growing market for
 remote-access products, which connect mobile computer users, home
 offices and small branch offices to larger public and private computer
 networks. 

 ''We want to quickly become a participant'' in a market that corporations
 are coming to consider more and more important, Bay Networks Chairman
 Paul J. Severino said. 

 Bay said that Xylogics will become an independent operating unit managed
 by current Xylogics executives. Xylogics President and Chief Executive
 Bruce Sachs will become president and general manager of the Xylogics unit
 and report directly to Bay Networks' president and chief executive, Andy
 Ludwick. 

 For the fiscal year ended June 30, Bay reported net income of $131 million,
 or $1.10 a share, on revenue of $1.34 billion. Results for the year included
 expenses from the merger that formed the Santa Clara, Calif. company. 

 In May, Bay agreed to acquire closely held Centillion Networks Inc.,
 another computer-networking concern, for about $140 million. 

 Bay Networks Chief Financial Officer William Ruehle said the combination
 of the two companies should add to earnings in about one year. In the first
 and second quarters, he estimated, the earnings dilution should be about 1
 cent a share. 

    Networking stocks are continuing to be hit hard. Which would be the
    best to buy now?