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Technology Stocks : Enterprise Informatics -- Ignore unavailable to you. Want to Upgrade?

To: Elliot Puritz who wrote (3597)	5/13/1999 11:44:00 AM
From: SIer formerly known as Joe B.	Read Replies (1) \| Respond to of 13797

Hummingbird sweetens PC DOCS bid with cash offer By Susan Taylor TORONTO, May 13 (Reuters) - A bidding war among Canadian software companies intensified on Thursday as Hummingbird Communications Inc. <HUM.TO> upped its offer for PC DOCS Group International Inc. <DXX.TO> to C$11 a share in cash. That beats out a hostile bid from Open Text Corp. <OTEX.O> by C$2.50 a share and replaces an earlier friendly stock-swap offer for PC DOCS by Hummingbird. The agreement between Toronto-based Hummingbird and PC DOCS, which runs until May 19, values PC DOCS at about C$305 million. That is nearly 30 percent richer than a May 4 Open Text takeover bid of C$8.50 a share, worth about C$235.5 million. "They're trying to come up with a preemptive number," said Duncan Stewart, a partner at Tera Capital Corp., of Hummingbird's latest bid. Despite that strategy, Stewart said the deal is no slam dunk and Open Text may return to the table with a higher offer. "I would argue that Open Text can improve on their bid," he said. Bay Street is now watching for Open Text's response to Hummingbird's latest volley. "The ball is in their court," said David Beck, an analyst with TD Securities Inc. in Toronto. "Will they come back? The bid's come in at what we would consider the high end of the range for PC DOCS." PC DOCS shares rallied on the announcement, gaining C$1.70 on the Toronto Stock Exchange to C$10.95 in morning trade. Hummingbird, meanwhile, fell C$1 to C$22 on the TSE, while Open Text dropped $1.13 to $33 on the Nasdaq Stock Market. The sweetened offer comes after Hummingbird and PC DOCS extended an earlier arrangement by two days to respond to the bid from Waterloo, Ontario-based Open Text, which develops software that helps employees share and manage information. PC DOCS, which develops document management software, had agreed in March to accept Hummingbird's bid. The all-stock offer was an exchange of one Hummingbird common share for three PC DOCS common shares, a deal valued at about C$212 million. Shareholders holding 16 percent of PC DOCS common shares have signed lock-up agreements with Hummingbird, agreeing to tender their shares to Hummingbird's latest offer. PC DOCS' board of directors has unanimously endorsed Hummingbird's bid, which will see PC DOCS become an operating division of Hummingbird. Rubin Osten will become vice-chairman of Hummingbird and keep his position as PC DOCS president. The deal still needs to be approved by two-thirds of PC DOCS shareholders and regulatory agencies. PC DOCS said it will not solicit other offers and will pay a C$15 million break-up fee it the deal doesn't go through. ($1=$1.46 Canadian) ((Susan Taylor, Reuters Toronto Bureau, 416-941-8100, fax 416-869-3436)) REUTERS * end of story *