On Friday, flash media maker Lexar Media (LEXR) obtained a better revised takeover bid from Micron Technological know-how (MU). The revised bid areas the all-inventory Trade supply at all-around $10 a share, up marginally in the Preliminary bid.
But significant shareholders which includes billionaire investor Carl Icahn together with hedge cash and portfolio professionals have considered the initial bid to generally be inappropriate. Elliott Associates believes the initial bid “noticeably undervalues Lexar,” and feels Lexar is value between $one.five billion and $2.four billion. The estimate is perfectly over the revised takeover bid of about $827 million.
I must concur and say the revised takeover bid is way much too lower and ought to be rejected by shareholders. Micron wants to pay back about one.10x sales for Lexar although the industry leader SanDisk (SNDK) is trading at 4.35x profits. Lexar also contains a $four hundred million patent infringement lawsuit in opposition to Toshiba that it experienced Beforehand won but has become matter to an attraction by Toshiba.
Consider it by doing this, An effective $400 million settlement in website favor of Lexar would equate to all-around $4.83 for each share in supplemental cash to incorporate to The existing $0.fifty four in no cost dollars soon after financial debt that Lexar has. What this means is Micron would fork out below $5 a share for Lexars property, which can be small.
You can find also speculation that SanDisk is very seriously thinking of using a run at obtaining Lexar. This would make sense http://query.nytimes.com/search/sitesearch/?action=click&contentCollection®ion=TopBar&WT.nav=searchWidget&module=SearchSubmit&pgtype=Homepage#/소액결제 since SanDisk would solidify its leadership situation.
Also, SanDisk has an in depth Doing the job romantic relationship with Toshiba, which could see SanDisk drop or reduce the settlement if it managed to accumulate Lexar.
Keep tune. A Unique shareholder Conference to evaluate the takeover bid is moved to June sixteen. In my watch, the $10 bid undervalues Lexar. Issue is will a white knight floor?