More experts predicting Siebel sale
With each move made by CRM specialists Siebel Systems, it seems that more industry watchers are predicting that the company is positioning itself to be acquired.
After Siebel's news Thursday that it is adopting an employee retention benefit program to keep workers from jumping ship, at least one expert said the strategy may not be aimed at strengthening corporate ranks against a buyout, but instead meant to keep people onboard to make such a deal more attractive to potential suitors.
Michael Trigg, an equities analyst with Morningstar, said the retention program could represent what he called "the beginning of the end" for Siebel.
"The funny thing is, people think they're strengthening ranks to block an acquisition, but I think it could be an admittance that they are indeed looking to sell out, and trying to sweeten the pot for employees in the meantime," Trigg said.
The analyst downplayed rumors that Siebel could be preparing to unload its estimated $2.2 billion in cash reserves via a dividend payout to shareholders, or that it may use the money to buy back some of its shares, or even take the firm private. Trigg pointed out that the company has never been active about making similar moves in the past.
"One thing that has differentiated Siebel from a lot of other successful software companies is that they never bought back stock to offset dilution from options," Trigg said.
Another indicator that the company is looking to sell, rather than use the money to grow parts of its business, was the news that Eileen McPartland, Siebel's former senior vice president of global services, had stepped down from her job after less than a year in the position. McPartland was considered a critical element of Siebel's bid to grow its services business under Michael Lawrie, the firm's recently departed chief executive.
On the short list of companies rumored to be possible Siebel buyout candidates are its closest rivals in the enterprise space, Oracle and SAP. Other names mentioned frequently as potential Siebel buyers are Microsoft and even companies once rumored as acquisition targets of the CRM maker, including business intelligence specialists Hyperion.