NetApp ups offer to buy Data Domain
The company increases its bid for Data Domain to $30 a share, countering a similar per-share offer made Monday by EMC--which says its bid remains superior.
The battle to buy Data Domain is in full swing.
Late Wednesday, NetApp upped its bid to acquire Data Domain to $30 a share after EMC jumped in earlier in the week with its own buyout offer. On the surface, both proposals seem similar. But EMC claims its bid is superior and predicts Data Domain shareholders won't approve the NetApp agreement.
Thewas unveiled on May 20. NetApp's offer then was $25 a share, or $1.5 billion total, a deal that seemed to sit well with Data Domain. But on Monday, , a total price tag of $1.8 billion. On Wednesday, NetApp then parried EMC by raising its own proposal to $30 a share.
Though both bids rest at the same price per share, EMC claims its offer isn't subject to the same conditions and limitations as the NetApp offer and that it's a better deal for Data Domain shareholders.
"EMC's all-cash tender offer remains superior to NetApp's proposed part-stock merger transaction," Joe Tucci, EMC's chairman, president, and CEO said in a statement. "We are proceeding with our superior cash tender offer, which is not subject to any financing or due diligence contingency. We do not believe that the Data Domain stockholders will approve the merger transaction with NetApp."
Data Domain is a top provider of deduplication storage systems, which let enterprise customers more easily back up data across different systems. Despite the global recession, Data Domain is doing well compared to its competition. First-quarter revenue for 2009 jumped 50 percent over the previous year, thanks in part to a surge in new customers.
EMC says it wants Data Domain for its strong management and sales teams and to complement its own backup and storage technology. EMC has been in a buying mood the past few years, having picked up Network Intelligence in 2006.and start-up firm last year and
Could the shopping spree end here? Data Domain seems to prefer NetApp as suitor. Its board of directors has already unanimously approved NetApp's revised transaction agreement.
"We are pleased with the revised terms of NetApp's acquisition offer," Frank Slootman, president and CEO of Data Domain, said in the company's statement Wednesday, "and feel it will provide great value to our shareholders and customers."
The NetApp deal is expected to close in 60 to 110 days, subject to regulatory approval. EMC's current tender offer will expire at June 29 unless extended.