On Friday, flash media maker Lexar Media (LEXR) received an increased revised takeover bid from Micron Technological innovation (MU). The revised bid locations the all-inventory Trade provide at around $10 a share, up marginally with the Preliminary bid.
But key shareholders which include billionaire investor Carl Icahn in addition to hedge money and portfolio managers have considered the initial bid to be inappropriate. Elliott Associates thinks the Original bid “substantially undervalues Lexar,” and feels Lexar is worthy of between $one.five billion and $2.four billion. The estimate is properly over the revised takeover bid of about $827 million.
I must concur and say the revised takeover bid is way far too very low and ought to be turned down by shareholders. Micron really wants to pay out around one.10x sales for Lexar while the market leader SanDisk (SNDK) is trading at 4.35x product sales. Lexar also features a $four hundred million patent infringement lawsuit versus Toshiba that it experienced previously here won but is now issue to an appeal by Toshiba.
Give it some thought in this manner, a successful $four hundred million settlement in favor of Lexar would equate to all-around $4.83 for every share in further money so as to add to the current $0.54 in cost-free dollars immediately after personal debt that Lexar has. What this means is Micron would pay a lot less than $five a share for Lexars assets, that's http://query.nytimes.com/search/sitesearch/?action=click&contentCollection®ion=TopBar&WT.nav=searchWidget&module=SearchSubmit&pgtype=Homepage#/소액결제 small.
There is certainly also speculation that SanDisk is severely considering taking a operate at obtaining Lexar. This may seem sensible considering the fact that SanDisk would solidify its Management place.
Also, SanDisk has a close Operating romance with Toshiba, which could see SanDisk drop or lessen the settlement if it managed to amass Lexar.
Continue to be tune. A Distinctive shareholder meeting to assessment the takeover bid has long been moved to June 16. In my see, the $ten bid undervalues Lexar. Query is will a white knight floor?