The board at BEA Systems (BEAS) is sitting on a $17 offer from Oracle (ORCL). BEAS has not traded above $17 in over four years and was sitting at about $14 before the Oracle offer. That may make it difficult to get Wall St. to believe that the company is worth much more.
But, BEAS asked its banker Goldman Sachs to put a value on the company. The figure of $21 came back. It is hard to know how that figure was supported, but BEAS told Oracle and the world that the company was not for sales for anything less.
BEAS has not gotten any new bids. Oracle is the only interested party. It would not be logical for it to offer more. There is no competition.
So, The BEAS board is playing with fire. If Oracle wakes away, the stock that trades just above $17 is likely to drop to $14, or lower. And, that is the stuff that shareholder lawsuits are made of.
Douglas A. McIntyre
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