EMC likely to up Data Domain stake with improved offer
15 Jun 2009
EMC Corp intends to increase its bid for Data Domain Inc to pip rival suitor NetApp Inc, to the post. NetApp could offer as much as $35 a share according to sources in the know.
The top maker of data storage equipment, EMC, has put in an offer for $30 a share, amounting to $1.8 billion cash, for Data Domain but the company preferred to go with NetApp following NetApp revising its offer upward from $25 a share to match EMC's price.
EMC's is looking to either win Data Domain or at least up the stakes to a point where the smaller rival will find the acquisition too expensive that would end up weakening its finances.
According to analysts, EMC is in a stronger position going by its balance sheet and could easily outbid NetApp but there remains a possibility of antitrust regulators queering EMC pitch because of EMC's leading position in the storage equipment market.
According to another source, EMC holds about $7.1 billion in cash, including $4 billion in the US and could go up to $34 to $35 per share.
Both EMC and NetApp play in the same domain making hardware and software that allows companies to store, manage and back up their data. They are interested in Data Domain's technology because it eliminates duplicate data during back-up processes which lets companies save top dollar in costly storage space.
