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Hedge Fund Offers $2 Billion For Novell
CWmike writes "A hedge fund that is already one of Novell's largest shareholders offered on Tuesday to acquire the struggling, cash-rich enterprise software maker for $2 billion. The unsolicited offer, from New York-based Elliot Associates L.P., is for $5.75 per share in cash, a dollar per share more than Novell's closing price Tuesday of $4.75. The offer caused Novell's stock to leap 29% to $6.15 in after-hours trading. Because Novell is so cash-rich — it had $991 million in cash and equivalents at the end of January (PDF) — Elliott says the deal values Novell as an enterprise alone at about $1 billion."
beyond that norton is not novell, novell actually has a pretty strong enterprise presence. A hedge fund buying novell is a really bad sign, to be honest. Novell is doing fine. Them trying to label Novell as unsuccessful is basically a flat out BS.
What I suspect this means is that someone's trying to stop Novell before the Novell v. SCO case comes around. They're trying to see if the Novell board is greedy enough to do it, and I suspect they aren't and neither are the shareholders.
A hedge taking over a company if that hedge has no experience managing in the sector of the company they're taking basically means they're going to tack on association/management fees onto novell and dump them to someone else.
It is like I have been saying for years...Wall Street is just Las Vegas with better clothes....a vulture comes in, and day traders, the boils on the ass of society, go apeshit and start buying, driving up the price. It is thanks to this kind of stupidity that companies only think short term now and let their assets go to pot. It is the whole "screw everything but the quarterly report!" that has caused so much of this country to fall apart. If a company could increase the quarterly by burning the company for the insurance the day traders would be all for it. It is nothing but legalized gambling for those that aren't inside traders.
As for TFA? My guess is the raiders want to drain the coffers and spin off Groupwise and a few other assets to make a quick buck. There are enough Groupwise customers out there that it could make them a quick buck, hence the offer. The only question is will they pull a Yang and get greedy and price themselves right out of the offer with poison pills and demands for crazy money. Either way their stock will probably hit the basement if the deal doesn't go through, as the day traders follow the herd to the next deal.
ACs don't waste your time replying, your posts are never seen by me.