Is $1.2 billion Emulex Corp.’s magic number?
Some analysts think the Costa Mesa maker of electronics for data networks won’t even consider an offer from Irvine’s Broadcom Corp. that’s lower than that.
After weeks of wrangling, chipmaker Broadcom on Monday upped its hostile bid for Emulex from $764 million to $912 million.
Emulex’s response: We’ll think about it. It also urged its shareholders not to sell any of their stock to Broadcom.
That sparked a selloff in Emulex shares as investors and analysts bet that Emulex, again, would reject Broadcom’s offer.
(The shares were flat at close of Wednesday trading with a market value of $812 million.)
Now some think the two-month takeover drama could be coming to a head.
Emulex could hold out for an offer closer to its starting point of $15 a share, or $1.2 billion, and Broadcom could walk.
In raising its offer, Broadcom also said it’s dropping a lawsuit and appeal to Emulex shareholders to replace the company’s board.
Some analysts think that means Broadcom is ready to walk away when its latest offer expires on July 14.
For more on Broadcom’s latest offer,
read Monday’s Business Journal article.
For more on the deal’s back story,
read a recent Business Journal article.
