Struggling workstation vendor Silicon Graphics Inc has taken a 26.4% stake in the equally struggling graphics board company Number Nine Visual Technology Corp, becoming the largest stockholder in the company. The stake is the result of SGI agreeing to convert into equity the $9m cash injection it lent the Lexington, Massachusetts-based company back in May (CI No 3,407). Number Nine badly needed the money to continue with the development work on its fourth generation, Ticket To Ride Revolution IV 128-bit video accelerator chip, launched at the end of May and now sampling (CI No 3,419). The news broke a day after Number Nine reported revenues for its second quarter of $3.8m, down a huge 46% from the $7.1m it posted in the same quarter the previous year. Losses for the quarter were $4.5m, compared with a $9.6m loss last year. Number Nine blamed continued intense competitive pricing as its third generation products reach the end of their lifecycle. Number Nine signed a strategic relationship with Silicon Graphics three months ago, and says the two are working together on joint product development and marketing activities that will improve our competitive positions in the technology marketplace. The two expect to jointly introduce products during 1998.
