Business Week- Openwave Systems, dogged by sliding sales and a steady stream of red ink, has nonetheless attracted a suitor. But the communications software and services provider stiff-armed hedge fund Harbinger Capital June 5, recommending that its shareholders reject Harbinger’s partial tender offer for 49% of the company’s common stock. The company also declared a one-time special cash dividend of $100 million.
The news did not go over well on Wall Street, as Openwave shares slid in Nasdaq trading June 5.
Openwave said its directors rejected the unsolicited partial tender offer from two funds controlled by Harbinger to buy 40,389,560 of its shares, or approximately 49% of the total, for $8.30 per share in cash. Harbinger said May 22 that it owns 11,110,000 Openwave shares, or around 13%, and would hold 62% if the offer were completed.
“After careful evaluation, Openwave’s Board unanimously determined that Harbinger’s unsolicited partial tender offer undervalues Openwave and is not in the best interests of the Company and all of our stockholders,” the company said in a June 5 press release.
