On Friday, flash media maker Lexar Media (LEXR) obtained a greater revised takeover bid from Micron Know-how (MU). The revised bid sites the all-inventory exchange give at all-around $ten a share, up marginally more info from the initial bid.
But important shareholders which includes billionaire investor Carl Icahn as well as hedge funds and portfolio administrators have considered the First bid for being inappropriate. Elliott Associates believes the Original bid “significantly undervalues Lexar,” and feels Lexar is worth concerning $1.5 billion and $2.4 billion. The estimate is perfectly previously mentioned the revised takeover bid of about $827 million.
I have to concur and say the revised takeover bid is way also reduced and really should be rejected by shareholders. Micron desires to fork out around 1.10x product sales for Lexar when the market chief SanDisk (SNDK) is buying and selling http://query.nytimes.com/search/sitesearch/?action=click&contentCollection®ion=TopBar&WT.nav=searchWidget&module=SearchSubmit&pgtype=Homepage#/소액결제 at 4.35x profits. Lexar also has a $400 million patent infringement lawsuit in opposition to Toshiba that it experienced previously gained but has become subject matter to an charm by Toshiba.
Think about it in this manner, a successful $400 million settlement in favor of Lexar would equate to about $four.eighty three per share in added funds to include to the current $0.54 in free of charge dollars following credit card debt that Lexar has. This implies Micron would pay back lower than $five a share for Lexars assets, which can be minimal.
There is certainly also speculation that SanDisk is seriously considering having a run at getting Lexar. This would sound right considering that SanDisk would solidify its Management posture.
Additionally, SanDisk has a detailed Doing work marriage with Toshiba, which could see SanDisk fall or reduce the settlement if it managed to acquire Lexar.
Remain tune. A special shareholder Conference to assessment the takeover bid has become moved to June sixteen. In my watch, the $ten bid undervalues Lexar. Query is will a white knight surface?