Tech companies beware, a bear may be outside your door
Electronic Arts' unsolicited buyout bid for Take-Two is just one of three high-profile technology "bear hugs" in the past four months.
Has your tech company played coy with a potential suitor lately? You may want to rethink your reaction.
In the past four months, Oracle, Microsoft, and Electronic Arts have all launched high-profile, unsolicited buyout bids for reluctant targets. Such efforts are otherwise known as bear hugs.
Oracle put the squeeze on middleware competitor BEA Systems in October; Microsoft did likewise with Yahoo at the start of this month; and on Sunday, EA made a play for rival game publisher Take-Two Interactive Software.
Did someone forget to put the lid back on the honey jar?
In the case of Oracle, it was ultimately successful in forcing BEA Systems down the merger aisle after a three-month chase around the kitchen table and no white knight to intervene. Sure, a couple potential suitors talked of coming to the rescue, but ultimately none of them saddled up.
And like a Hollywood movie that's been recast with a tweak, a virtual rerun is unfolding with the Yahoo's efforts to fend off Microsoft. There's talk of News Corp. or AOL stepping in to offer aid, but odds makers give those prospects a long-shot.
But what really serves as the common thread among Oracle/BEA, Microsoft/Yahoo, and now EA/Take-Two is that the parties had previously expressed an interest in acquiring the target companies from as early as a year before starting a bear hug.
So, dust off your calendar. Who's gently knocked on your company's door in the past year about a potential merger? You might want to stash the honey jar and hire some bear trackers.