Can This Buyout Save Synchronoss?
Shares of Synchronoss Technologies Inc. (NASDAQ: SNCR) jumped on Friday after the firm reported that it has received a buyout offer. This may look good on the surface but shares were close to a multiyear low (back to 2009). Investors may be happy to get out with some money at this point.
Essentially, Synchronoss reported that it received a non-binding indication of interest from Siris Capital to acquire all the outstanding shares for $18 per share in cash. This is a premium of about 48% from the previous close.
And this offer is more or less a premium of 16% from the stock’s 50-day moving average of $15.46. However, it is a discount of 43% from the 200-day moving average of $31.58. It looks like the vultures may have got to this one.
Excluding Friday’s move, the stock had underperformed the broad markets, with the stock down 68% year to date. Over the past 52 weeks, the stock is down 63.5%.
Synchronoss released a statement saying:
The Company’s Board of Directors, consistent with its fiduciary duties, will carefully review and consider Siris’s indication of interest and pursue the course of action that it believes is in the best interests of the Company and its shareholders. The Board cautions the Company’s shareholders and others considering trading in its securities that the Board just received the non-binding indication of interest from Siris and no decisions have been made with respect to the Company’s response to the indication of interest. There can be no assurance that any definitive offer will be made, that any agreement will be executed or that this or any other transaction will be approved or consummated. The Company does not undertake any obligation to provide any updates with respect to this or any other transaction, except as required under applicable law. The Company’s shareholders do not need to take any action at this time.
Shares of Synchronoss were last seen up about 38% at $16.84, with a consensus analyst price target of $17.93 and a 52-week range of $10.11 to $49.94.