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BEA's hold-out on price likely to lead to a lower offer

BEA's brinkmanship is likely to cost its shareholders dearly.

Paul Kedrosky paints a not-so-pretty picture of BEA's future. Now that it has rejected Oracle's offer of $17/share through pocket veto, all the while begging for a higher price, it's almost certainly going to get a lower offer the next time around.

What happens next is rarely pleasant. Absent a change of heart, or a new offer somehow emerging, the initial acquirer will likely come back and make another offer -- this time, however, for less than was originally offered. Why not? After all, the market just told it that it offered too much, so it might as well offer less.

That is what the future likely holds for BEA. It will almost certainly be bought, but likely at a price under the price Oracle originally offered for the company. Ouch.

BEA took the high road. Now it's likely to get run over.