US networking giant Cisco is considering walking away from a $3bn (£1.8bn) deal to purchase videoconferencing firm Tandberg after some shareholders in the Norwegian company were said to be pushing for a higher offer, according to a Bloomberg report.
Citing "a person familiar with the transaction", the report explained that the shareholders resisting a sale at the current price own 24 per cent of Tandberg. It said that Cisco would "strongly consider walking away" if it is unable to get investors with 90 per cent of the company to agree to its 153.5 krona (£13.28) a share offer.
Cisco made the original bid for the firm at the beginning of October, with the aim of expanding its videoconferencing business. Tandberg is the second largest manufacturer of such equipment, and its chief executive, Fredrik Halvorsen, would become the head of a new videoconferencing division if a deal goes through.
However, Tandberg's board has backed Cisco's offer, and industry experts seem to believe that the deal will still go through in its present form.
"I think it's quite unlikely that Cisco will drop its offer. Everything points to it buying Tandberg," Arctic Securities ASA analyst Martyn Hoff was reported as saying. "It's probably smart of Cisco to send some signals to scare the shareholders into accepting the offer."
Tandberg shareholders have until 9 November to accept the offer.
See also:
Deal will help Cisco expand into lucrative web security space 27 Oct 2009
Purchase will add IP mobility solutions 13 Oct 2009
Company releases additional products for Unified Computing platform 10 Oct 2009
New service combines Unified Communications with Service Cloud 06 Oct 2009All Applications Tags: Financials, Mergers-and-acquisitions, Videoconferencing, Voice-and-data, Cisco, Tandberg, Software, Strategy
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