On Friday, flash media maker Lexar Media (LEXR) been given a greater revised takeover bid from Micron Technology 신용카드현금화 (MU). The revised bid areas the all-stock exchange provide at all around $ten a share, up marginally http://query.nytimes.com/search/sitesearch/?action=click&contentCollection®ion=TopBar&WT.nav=searchWidget&module=SearchSubmit&pgtype=Homepage#/소액결제 in the Original bid.
But key shareholders like billionaire Trader Carl Icahn along with hedge cash and portfolio supervisors have deemed the Preliminary bid for being inappropriate. Elliott Associates believes the Original bid “noticeably undervalues Lexar,” and feels Lexar is truly worth in between $1.5 billion and $two.four billion. The estimate is well previously mentioned the revised takeover bid of about $827 million.
I have to concur and say the revised takeover bid is way as well lower and really should be rejected by shareholders. Micron really wants to pay all around 1.10x sales for Lexar though the industry leader SanDisk (SNDK) is buying and selling at four.35x profits. Lexar also includes a $400 million patent infringement lawsuit against Toshiba that it had Formerly won but is currently subject matter to an appeal by Toshiba.
Give it some thought by doing this, a successful $four hundred million settlement in favor of Lexar would equate to all over $4.eighty three for every share in added income to incorporate to The existing $0.54 in cost-free cash soon after credit card debt that Lexar has. This means Micron would spend lower than $5 a share for Lexars property, which can be very low.
There may be also speculation that SanDisk is very seriously thinking of using a operate at acquiring Lexar. This might sound right due to the fact SanDisk would solidify its Management place.
In addition, SanDisk has a detailed Performing connection with Toshiba, which could see SanDisk fall or lessen the settlement if it managed to obtain Lexar.
Keep tune. A special shareholder meeting to critique the takeover bid is moved to June sixteen. In my view, the $ten bid undervalues Lexar. Dilemma is will a white knight area?