EMC Corp.'s hostile takeover bid to buy shares of 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 announced after the close of markets today that 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 cq insists his company's $1.8 billion, all-cash offer is superior, but EMC admitted that only about 174,000 Data Domain shares have been tendered, a fraction of one percent of all company shares outstanding.
Charles Whitehead, associate professor at Boston University School of Law, said that the weak showing may simply indicate that Data Domain shareholders are waiting for EMC or NetApp to make a better offer. Whitehead noted that Data Domain shares closed Friday 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.
Neither NetApp nor Data Domain would comment on the EMC tender extension. (By Hiawatha Bray, Globe staff)