<<during "marketwrap" on CNBC, joe kernen just said that from an unnamed source, your evil LUcy may indeed be the suitor.>>
I wouldn't be entirely surprised if this proved true, and if so, would be a vindication for CIEN shareholders because among the potential suitors, LU has the deepest pockets, the most extensive telco customers with which to leverage CIEN's products, and does not mind paying well for the companies it buys (It paid 10x sales for Livingston).
Leveraging LU's extensive customer list -- on top of those it can win on its own -- I believe CIEN can easily achieve at least 50% per year revenue growth for LU. Therefore buying CIEN at a high PS ratio will easily be justifiable for LU.
Therefore, IMO, if LU proves to be a suitor, it's not inconceivable that it will offer at least $30 per share -- and that's still a bargain since TLAB was willing to pay as much as $70 per share for CIEN.
Merged with LU -- all the reasons why CIEN lost so much of its value will become irrelevant because CIEN will win back AT&T and add a plethora of other contracts to compensate for DTI.
The "Evil Empire" wins. But what the heck, so does CIEN.
I just know that if this happens, TLAB will seethe. |
