Speculating in Takeover Targets Message Board

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Strategies & Market Trends : Speculating in Takeover Targets

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To: richardred who wrote (2186)	4/6/2009 11:11:11 AM
From: richardred	Read Replies (1) of 7254

Report: IBM-Sun talks collapse Jacksonville Business Journal International Business Machine Corp.'s acquisition talks with Sun Microsystems Inc. have reportedly collapsed. The New York Times reported Sunday unnamed sources close to the talks said IBM (NYSE: IBM) withdrew a $7 billion offer a day after Sun's board was unhappy with a reduced offer. The Wall Street Journal earlier on Sunday reported that unnamed sources had told it IBM uncovered potential conflicts with Sun's (NASDAQ: JAVA) software licenses that had put the deal in doubt. The Journal first reported two weeks ago that IBM would pay between $10 and $11 a share for Sun, but reports last week said that the offer had been reduced to $9.55 a share. The Times reported Sunday the offer Sun directors balked at on Saturday had been dropped to $9.40, which was still more than double where Sun shares were trading before the potential deal became known. Sun's stock closed at $8.49 on Friday. The paper said the board didn't totally reject IBM's offer but sought conditions that the buyer considered "onerous." The Times reported the board is split, with CEO Jonathan Schwartz in favor of accepting the reduced bid and Chairman Scott McNealey opposed. Sun has struggled in recent years, cutting about 13,000 jobs since early 2006 when Schwartz became CEO. Its strength with financial sector companies has been viewed as a weakness as that industry sector has struggled. The company was said to have been shopping itself around for some time before the talks with IBM heated up. Acquiring Sun was seen as a way for IBM to increase share in the data server market. jacksonville.bizjournals.com

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