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EMC just won’t take no for an answer.
This week the storage giant raised the stakes in the bidding for Data Domain, increasing its ALL CASH offer to $33.50 per share, or $2.1 billion. The move is perhaps a last ditch attempt to steer the Data Domain board away from accepting an offer of $1.9 billion from NetApp.
Although there has been speculation that EMC would up the ante, this move does indeed open a new chapter in the Data Domain acquisition battle.
EMC is of course on one side of the ring - holding all cash and desperately trying to dangle it in front of Data Domain.
On the other side is NetApp - the chosen favorite thus far - but holding part stock, part cash.
Offers aside though, there are still other factors at play - including a $57 million termination fee Data Domain would likely have to pay NetApp for an acquisition agreement that began back in May.
EMC’s latest bid does not include such a fee or other “deal protections,” according to EMC.
“In comparison to your proposed transaction with NetApp, EMC’s proposal represents a far superior alternative for your stockholders,” EMC chairman Joe Tucci wrote in his offer letter to Data Domain chairman Aneel Bhusri.
In a separate statement, NetApp CEO Dan Warmenhoven said the company’s board “will carefully weigh its options.”
NetApp said it has received clearance from the U.S. Securities and Exchange Commission (SEC) and Federal Trade Commission (FTC) to proceed with the deal, and Data Domain’s board has called an Aug. 14 meeting to vote on its latest offer.
In turn, EMC also said the FTC has given it permission to proceed with a purchase of Data Domain - and could seal the deal in as little as two weeks, a whole month before NetApp is scheduled to close.
It remains to be seen what effect these new developments will have on Data Domain’s board - but by the looks of it, deal protection could be the deal breaker for NetApp.
Stay tuned folks. The summer’s just heating up.
Get Caught Up:
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| Around the ’sphere:
EMC Puts Data Domain on the Spot - DealBook Blog - NYTimes.com - In addition to raising its offer, EMC has taken an interesting legal approach as it tries to snatch Data Domain from its chosen acquirer, NetApp. EMC Likely Winner Over NetApp in Bid for Data Domain | John … - NetApp has cleared all necessary US regulatory hurdles to proceed with its acquisition of Data Domain, though it seems unlikely that the company will prevail now that rival EMC has trumped its bid for the storage vendor. EMC Raises Data Domain Offer | Xconomy - Determined not to be outbid by rival NetApp for data deduplication software maker Data Domain, Hopkinton, MA-based EMC (NYSE: [[ticker:EMC]]) today increased. Data Domain Gets Increased Offer From EMC - The competition between EMC and NetApp for Sunnyvale-based data storage firm Data Domain is heating up again, as EMC said Monday that it has upped its offer for Data Domain to $33.50 per share in cash for the firm. … |
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