Here's a good comparison to help you evaluate the 'deal' Inprise shareholders are receiving.
Sun bought a somewhat similar company called Forte. Forte had negative earnings, and some (not great) revenue growth. Forte shareholders in the deal received shares of Sun, a large, respected, high profile, tech company with a very strong share price history. Here are the statistics:
total value of deal: $540 million
value per share: $22
FRTE 52 week high: $17.125
FRTE prior to deal: $17
FRTE a week after deal: about $21.50
FRTE at close of deal: $28
deal relative to revenue: about 7x revenue
Forte's assets less liabilities: $37 million
deal (less book) relative to revenue: about 6x revenue
Corel is buying Inprise. Inprise has a slight earnings loss, neutral cash flow, and slowly declining revenue. Inprise shareholders in the deal are to receive shares of Corel, a small, wall street shunned, mixed history, software company with a volatile share price that has averaged little growth in the past 7 years. Here are the statitistics (revenue doesn't include $100 millions MSFT license deal):
total value of deal: $1,060 million ($14.94 * 71 mill shares)
value per share: $14.94
INPR 52 week high: $20
INPR prior to deal: $12.9375 (it was $14 two days before)
INPR a week after deal: $11.75
deal relative to revenue: about 6x revenue (a bit under 6 actually)
deal (less book) relative to revenue: 4.5x revenue
I think removing book from the purchase value is useful to comparison, since INPR has a large amount of 'excess' assets (cash and real estate).
I don't know about you, but the INPR deal does not compare favorably. |
