EMC extends its offer for Data Domain shares
EMC Corp.’s hostile takeover bid to buy Data Domain Inc. is getting a 10-day extension. On June 2, EMC made a tender offer to buy shares of California-based Data Domain at $30 each. The tender was set to expire next Tuesday, but EMC yesterday said it would extend the offer to July 10.
The board of Data Domain has urged shareholders to reject the EMC effort; members plan to sell the company to EMC rival NetApp Inc. for $1.9 billion in cash and stock. EMC chief executive Joe Tucci insists his company’s $1.8 billion all-cash offer is superior, but EMC acknowledged only about 174,000 Data Domain shares have been tendered - a fraction of 1 percent of all shares outstanding.
“NetApp continues to believe that its friendly merger agreement with Data Domain is superior to EMC’s unsolicited offer,’’ wrote a NetApp spokesman in an e-mailed statement.
Charles Whitehead, associate professor at Boston University School of Law, said the weak showing may simply indicate that Data Domain shareholders are waiting for a better offer. Whitehead noted that Data Domain shares closed yesterday on the Nasdaq stock exchange at $33.13, well above EMC’s offer. He said investors think the current offers undervalue the company and are likely to go higher. “They think there’s going to be a bidding war,’’ Whitehead said.
Data Domain declined to comment.
