>>Any price under 100 will be fire sale.
Let's keep a little perspective here. Can you imagine what would happen to the stock of the acquirer if they were to pay $100 per share, or over a 250% premium over the current quote? They would get taken out back, beaten, killed, and dismembered, not necessarily in that order. The ink on the press release wouldn't even be dry before the first shareholder suits get filed trying to block the merger.
As someone pointed out earlier, the stock will have to keep moving up towards the ultimate buyout price before any announcement is made. I would say that in order to avoid major backlash, the premium of any takeout can't be more than 50% over the market value at the time of any announcement. So for those holding out for a $60 buyout, $40 had better come first. If you're banking on $100, $67 in open market trading has to come first.
One other point. I agree that COMS is undervalued relative for Fore, Ascend, Cisco, etc. However, COMS revenue is far greater than those (excluding Cisco) companies. The number of companies capable of buying COMS at even 7x sales is far fewer than those capable of buying a Fore at 7x. And, some of those handfull of companies may already have a date to the dance. |
