Cisco Again Hints It Would Drop Tandberg Bid If Need Be
By Benjamin Pimentel
Cisco Systems Inc. (CSCO) on Tuesday again said it would consider withdrawing
its offer for Tandberg (TAA.OS) if the tech giant does not reach the 90% mark
for tendered shares.
The San Jose, Calif.-based networking gear maker, shares of which were down
more than 1%, said only 9.4% of the Norwegian video-conferencing firm's shares
have been tendered as of Tuesday.
Cisco's$3 billion merger deal with Tandberg has been opposed by some of the
company's holders who are pushing for a higher price.
However, Cisco's chief strategy officer, Ned Hooper, said in a blog post last
week that the company will "always act with fiscal prudence" in its bid for
Tandberg, highlighting the possibility that the company was prepared to drop the
deal.
Chief Executive John Chambers said he would be willing to walk away from any
deal, without specifically mentioning Tandberg, if the price was deemed
unattractive.
Cisco extended the deadline for the offer period to Nov. 18. The company said
that "soon after" that date Cisco "will announce whether the 90% condition for
the offer has been met. If not, Cisco will evaluate whether or not to withdraw
the offer."
Cisco has won rave reviews recently, after posting upbeat results and a bold
bid to expand its reach into other arenas, marked by a series of acquisitions.
In a Tuesday note, Ticonderoga analyst Brian White noted that "since the
beginning of October, Cisco has been operating at a furious pace with four
acquisitions announced, a coalition and joint venture agreement for
virtualization solutions signed, a $5 billion debt offering priced and a host of
new product announcements. If there is any company that can teach other
organizations how to operate efficiently through collaboration and technology,
we believe it is Cisco."
Also on Monday, JPMorgan Chase & Co. analyst Steven O'Brien wrote, "We are now
more confident Cisco reached a demand tipping point irrespective of our longer-
term concerns over competition and technology substitution."
-Benjamin Pimentel; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
11-10-091609ET
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