EMC has extended its $1.8bn (£1.1bn) all-cash offer for deduplication storage
firm Data Domain until 10 July as lawsuits continue to muddy the waters.
The offer was originally meant to expire on 29 June, but EMC has bought more
time, hoping that the US Federal Trade Commission (FTC) rules in its favour.
In a
bidding
acquisition war that brings back memories of HCL Infosystems' and Infosys
Technologies' battle for Axon, EMC is competing with rival storage vendor NetApp
for the acquisition of Data Domain.
But this war is messier. After EMC topped NetApp's offer of $1.5bn (£910m) by
20 per cent at the beginning of this month, it was trumped by a counter offer
from NetApp of $1.9bn (£1.2bn).
Data Domain rejected the EMC offer on 15 June, arguing that it preferred
NetApp's bid. NetApp holds a 20 per cent stake in the company, compared to EMC's
0.5 per cent
EMC has insisted that its offer, which works out at $30 (£18) per share, is
superior based on stock valuations, and has asked the FTC to examine the bid.
"We continue to anticipate a routine review by the FTC resulting in a timely
regulatory approval," said Joe Tucci, EMC chairman and chief executive, in a
statement on Friday.
"We look forward to the execution of the definitive agreement and closing of
the transaction with EMC."
EMC is supported by legal firm Levi & Korsinsky, which has filed a class
action suit against the directors of Data Domain, asserting that its acceptance
of the NetApp bid was not in the best interest of shareholders.
The law firm argued that NetApp had offered positions on its board to Data
Domain executives. In a particular, there are rumours that Data Domain chief
executive Frank Slootman could be the next chief executive of NetApp. If this is
true, it raises questions as to whether the sales process conducted by the board
was fair and open.
Additionally, the Detroit Police and Fire Retirement System filed a separate
lawsuit, arguing that Data Domain's board of directors had given NetApp an
improper bidding advantage.
Data Domain is such a prize because of its success in the field of
eliminating data duplication, which is becoming a major storage problem. As
backups are made more frequently, the amount of largely useless duplicated data
grows.
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