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Days after EMC reached out in an open letter to Data Domain, there’s word EMC will sweeten its $1.8 billion offer to buy the deduplication firm.
Reuters reports that EMC will boost the value of its all-cash offer to acquire Data Domain to as much as $35 a share from its original $30. That would raise the value of the EMC bid to more than $2.1 billion.
The reason for this potential bid increase is, of course, NetApp - the other company vying to acquire Data Domain. NetApp has an $1.9 million offer on the table - part stock, part cash.
While neither EMC nor Data Domain have commented on this latest report - NetApp issued a statement warning that “the combination of EMC and Data Domain would stifle competition, is fraught with regulatory risk, and could lead to job loss and business disruption.”
Still though - money talks, right?
Wrong.
Industry insiders say the new issue up for discussion is monopoly.
Rajesh Ghai, storage sector analyst with ThinkEquity Partners LLC in San Francisco, said an EMC bid of $33 would probably put Data Domain out of NetApp’s reach.
But he added that EMC might go higher to offset concerns among Data Domain shareholders that the EMC purchase might be blocked by antitrust regulators.
EMC, the world leader in high-end data storage systems, already has a line of de-duplication products, and acquiring Data Domain could ensure its dominance in the market. Ghai predicted that regulators won’t block an EMC acquisition.
“I don’t think NetApp has too strong a case that these guys are going to create a monopoly situation,” he said.
But Ghai said that EMC might bid $35 a share to mollify worried Data Domain shareholders.
We shall see, won’t we?
A recommendation from the Data Domain board is expected soon.
Stay tuned.
Source: Hiawatha Bray, Boston Globe; EMC May Raise Bid For Data Domain
| Around the ’sphere:
Recovery Monkey » Blog Archive » About the Data Domain acquisition … - Much has already been written about this imminent acquisition of Data Domain by either NetApp or EMC and, since opinions are like you-know-what, and I have one, here it is… if I ramble, forgive me. I have too much to say and I’m trying … EMC appeals to Data Domain workers (Dealscape - Technology) - EMC CEO Joe Tucci urges Data Domain employees to favor a deal with his company instead of one with NetApp. EMC and NetApp Trade Jabs Over Data Domain - DealBook Blog … - Data Domain said last week that it had accepted a revised offer of $30 a share in cash and stock from NetApp — an offer which matches a similar bid from EMC. At the time, EMC shrugged off the rejection, asserting that its all-cash offer … Why Both EMC & NetApp Want Data Domain - The $1.5 billion offer for de-duplication leader Data Domain from NetApp, which has its own de-duplication technology, was an indicator … |
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