Any of you out there who have been contemplating purchasing a Meade telescope in the near future might want to consider that they appear to be having major financial problems, and it's geting worse. Their stock price dropped below $1.00 per share on Jun 19th and has remained below that level since then. What caused the stock to drop over 10% in trading on 16 June 2008 to close at $1.10 was a warning by auditors that there are doubts about the company's ability to continue in business. Their price was running a bit over $2.00 per share in September of last year, but it closed yesterday at $0.86. This is a drastic drop (over 57%) in less than a year. They sold off their Simmons, Weaver and Redfield brands (rifle and outdoors optics) earlier this year in an effort to stem the tide, but they are still bleeding cash at this time. There are concerns in the financial markets at this point that Meade may not make it to 2009 in it's present form. These are tough times for Meade. If their stock price remains below $1.00 for 30 days, they will get a de-listing notice from NASDAQ, and then be given 180 days to get it over $1.00 for 10 consecutive days. If that doesn't happen, then they disappear from the exchange, and it becomes more difficult for people to buy shares.

Will Meade Instruments disappear? Probably not. The name is too valuable to disappear completely. If stock price dips any lower, they'll be a target for takeover by just about anyone. The big concern would be what they will morph into as the result of any takeover. These questions will be up in the air until that happens:

• Would they be purchased by an existing optics maker who might fix the problems?


• Or would they be picked up by buyout artists who sell off the remaining pieces as scrap?


• ]How committed the new owner will be to the amateur scope business over the long run? Old Timers remember what happened to Criterion.


• What form and to what extent will their repair and support services evolve/devolve?

How does that affect us? Well, purchasing a new Meade product right now may get you a nice scope - with no chance of getting it repaired if there's something wrong or it gets damaged. There is a known problem with the declination drive on new LX90 scopes right now, and no one has yet taken delivery of an LX200 ACF, with no expected delivery date at this time. So, you may not get anything at all. On the other hand, used Meade equipment prices should be at an all-time low (slim chance of repair, no one to back them up.) You might be able to get a good used instrument for a lot less than last year.

All is not lost with Meade, however. They are taking steps to correct their financial woes, and the current restructuring may bring them into the clear. Meade senior management insists the company has the necessary cash flow to stay in business for at least the next 12 months. The company plans to introduce several new products during FY 2009 and will continue to cut costs whenever possible during the restructuring.

I, for one, hope they survive. They have traditionally made very good products. I personally have a Celestron SCT, but Meade was a close second choice. Competition drives innovation, and I doubt if we'd have as good a products on the market as we do if both Meade and Celestron were not in business. Interestingly enough, there's an ad in the August Sky & Telescope for Skywatcher 8" and 11" SCTs. Other competition? Not hardly. Rumor has it that the 11" is being delivered with Celestron still stamped on the cover of the secondary. I suspect that in the end we'll either choose Celestron or one of the Chinese builders for our next SCT - even if it's got Meade printed on it.

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Dave - Morrow, AR

That is VERY interesting news, Dave. I, too, would hope they survive, whether they have good service immediately or not. Staying in business would seem to me to be the most important thing for them, but I ain't got much larnin. I've dealt with their bad service before a few years ago, but it was for a very minor part I wanted and they just basically blew off my request for purchasing the part.

It really bothers me what you say about the RCX scopes. Are you saying that they aren't able to even deliver these newest of telescope types they've come up with? If so, were they just hoping that saying they'd be selling these new higher-tech scopes would bring in money they need to stay afloat?

I hope you will keep this subject up in the forum for a while, David. I'd like to continue to hear what's going on, good or bad for Meade. I'm like you, I hope they survive and become something better than they've been but I'd like to know if the end suddenly seems eminent. We'll have to have a telescope wake!!! BYOL, of course.....or not.

Keeping my fingers crossed for MEADE

Bob

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Bob Moody

More news -

Those of you who don't monitor the SCT-Users group on Yahoo (or other groups, I'm sure,) will not have noticed that Meade has now been issued the Deficiency notice from NASDAQ: Trading Markets Stock News

What this essentially means is that MEade has 180 days from now to get their stock over $1.00 per share for 10 consecutive days or they will be dropped from the exchange. This means that the company execs have about that long to decide what they are going to do - take the money and run (what there is of it,) or sell out, file bankruptcy or whatever. It's doubtful at this point that they could get the stock price up long enough to remain on the exchange. Of course, the company doesn't want you to know they're that bad off, they woould rather you thought that what they're doing is because they have great new stuff to sell: Nothng Like SPIN!

Hope the company survives - if for no other reason than the fact that it may ultimately give rise to new innovations.

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Dave - Morrow, AR