Cisco has extended its offer to 5:30 p.m. Nov. 18, at which time it will announce whether at least 90% of Tandberg stock has been tendered. Norwegian laws require at least 90% of stockholders to approve acquisitions.
"Soon after expiration of the extended offer period," Cisco said in a release, "Cisco will announce whether the 90% condition for the offer has been met. If not, Cisco will evaluate whether or not to withdraw the offer."
With Cisco making a big commitment to videoconferencing and telepresence applications, Tandberg would represent an important asset for Cisco's drive in the area. On the other hand, it believes its $3 billion offer for Tandberg is fair and points to a recent Ernst and Young analysis that found the offer was a fair deal for Tandberg stockholders.
A group of Tandberg stockholders, representing about 24% of the Norwegian firm's total shareholder population, has been holding out for an 11% increase over the $3 billion figure. The higher price would represent a 50% increase over Tandberg's stock price when reports of a possible acquisition began circulating.
Cisco CEO John Chambers has hailed an acquisition of Tandberg because the two firms have similar cultures. Tandberg's chief executive Fredrik Halvorsen has also supported the merger along with the remainder of Tandberg's top management. The Ernst & Young report was commissioned by Tandberg management.
Another problem for Cisco in agreeing to a higher bid is that the acquisition-happy firm fears it could set a precedent for other deals, which could become routinely challenged by stockholders seeking additional money after a deal has been struck.
Read InformationWeek's first-ever analysis of top CIOs in federal, state, and local government, and how they're embracing new expectations. Download the report here (registration required).