In fact, Foundry is dominating the day, with Brocade officials explaining how they decided on Foundry and what they expect to get from the deal. No huge surprises, but it's nice to get a substantial look at the thought process that went on.
Brocade is definitely gunning for Cisco Systems Inc. (Nasdaq: CSCO), but analyst Sam Wilson of JMP Securities was right: The company with more to lose is Juniper Networks Inc. (NYSE: JNPR). An opinion survey commissioned by Brocade a few weeks ago supports that.
Tom Buiocchi, Brocade VP of marketing, just now presented the results. Answering the question, "Who is best suited to be the vendor of choice for next-generation Ethernet?" people overwhelmingy said Cisco. Duh. But Juniper, which had been in second place, slips to third below Brocade/Foundry.
That's huge. "In enterprises that will consider two [vendors], getting the bronze medal is no big deal," Buiocchi said.
But consider this: Juniper got third place even though it doesn't have a strong data center presence yet. "That shows you how strongly people want Juniper to be in the data center," says Yankee Group Research Inc. analyst Zeus Kerravala.
That's something for Brocade to think about. "When Juniper comes out with a product for the data center, do they leapfrog past them?" Kerravala says.
— Craig Matsumoto, West Coast Editor, Light Reading
For the $3B Foundry buy, Brocade has fully committed financing from BofA and Morgan Stanley. CFO Richard Deranleau made a specific point of that, given the disasterous week the banking business is having.
Foundry's stock is something like 20% below the purchase price. Brocade is saying, if I understand it right, that it's begun buying stock already, to take advantage of that, and that it's explained in SEC filings.