Data Domain Bidding War Heats Up (DDUP, NTAP, EMC)

Investing

Published: June 3, 2009 7:12 am

Last Updated: April 27, 2020 7:57 pm

money-stack-image The war for Data Domain, Inc. (NASDAQ: DDUP) is heating up. It was first NetApp, Inc. (NASDAQ: NTAP) that offered to buy the company. Then EMC Corp. (NYSE: EMC) came out with a challenging bid. Now, NetApp is back with a higher revised buyout offer. The new offer values Data Domain at $30.00 per share. Traders believe an all-out bidding war may be about to break out.

NetApp’s first bid was $1.5 billion, or $25.00 per share in cash and stock. NetApp’s shares had actually risen higher than the official price. But EMC’s rival bid came in at $1.8 billion, or $30.00 per share. EMC’s offer was all cash, leaving no price-risk.

The new price for Data Domain common stock is valued at $30.00 per share in cash and stock. This is listed as a transaction valued at approximately $1.9 billion, which is actually net of Data Domain’s cash and subject to certain adjustments.

There was an analyst call yesterday calling a possible $35.00 peak buyout price. Shares closed at $31.58 yesterday and are trading up around $32.50 in early trading. With a premium of this sort, the belief is obviously that the bidding prices are heading higher rather than lower.

NetApp’s shares appear to be trading down close $19.00 in pre-market trading after closing at $19.34 Tuesday. EMC shares are trading at $12.75 after closing at $12.85 yesterday.

Jon C. Ogg
June 3, 3009

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