On Friday, flash media maker Lexar Media (LEXR) obtained an increased revised takeover bid from Micron Technology (MU). The revised bid sites the all-stock Trade offer at all over $ten a share, up marginally in the initial bid.
But major shareholders like billionaire Trader Carl Icahn coupled with hedge resources and portfolio supervisors have considered the Original bid being inappropriate. Elliott Associates believes the First bid “appreciably undervalues Lexar,” and feels Lexar is worthy of concerning $one.5 billion and $two.4 billion. The estimate is well above the revised takeover bid of about $827 million.
I must concur and say the revised takeover bid is way far too lower and should be turned down by shareholders. Micron wishes to spend close to one.10x product sales for Lexar although the industry chief SanDisk (SNDK) is investing at four.35x gross sales. Lexar also incorporates a $four hundred million patent infringement lawsuit versus Toshiba that it experienced Beforehand received but is currently subject matter to an attractiveness by Toshiba.
Think it over in this way, a successful $400 million settlement in http://query.nytimes.com/search/sitesearch/?action=click&contentCollection®ion=TopBar&WT.nav=searchWidget&module=SearchSubmit&pgtype=Homepage#/소액결제 favor of Lexar would equate to 소액결제현금화 close to $4.eighty three for each share in additional money to incorporate to The existing $0.54 in totally free income following financial debt that Lexar has. This means Micron would spend below $five a share for Lexars assets, which happens to be reduced.
You can find also speculation that SanDisk is severely pondering using a run at acquiring Lexar. This could make sense considering the fact that SanDisk would solidify its Management situation.
Moreover, SanDisk has a close working relationship with Toshiba, which could see SanDisk fall or lessen the settlement if it managed to accumulate Lexar.
Keep tune. A Exclusive shareholder meeting to evaluate the takeover bid has become moved to June 16. In my check out, the $10 bid undervalues Lexar. Concern is will a white knight floor?