Why Anaren Shares Soared

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Anaren (NASDAQ: ANEN  ) rallied more than 11% Monday after the company accepted an acquisition bid from privately held Veritas Capital.

So what: Specifically, Anaren signed a definitive merger agreement, under which it has agreed to be acquired by Veritas Capital in an all-cash transaction worth roughly $381 million, or $28 per share. For those of you keeping track, that's a premium for Anaren shareholders of approximately 12.4% over Friday's closing price of $24.91 per share.

Now what: This isn't the first time Anaren has entertained an offer. Remember, back in April with the stock trading under $20 per share, Vintage Capital approached Anaren with an unsolicited $23 per share acquisition proposal. However, Anaren subsequently dubbed Vintage Capital's offer "inadequate," saying it didn't reflect the intrinsic value of the company.

As it stands, and with shares currently up nearly 43% so far in 2013, Anaren's patience has obviously been rewarded with Veritas Capital's superior terms. With the stock trading at a premium of around 24 times last year's earnings, I think it's time for investors to finally take their profits and put them to work elsewhere.

Got iPad?
Apple
's newest iPad Mini with Retina display might be hard to come by this quarter, given all the reports of supply constraints. Well, we're going to be sure to get a few -- and give them away! That's right: For the first time ever, The Motley Fool is hosting a contest where you can win a free iPad Mini with Retina display. All you have to do is tell us why you love The Motley Fool by clicking here! We'll pick the three most Foolish submissions to receive a free iPad Mini with Retina display.

See full terms and conditions by clicking here


Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 2712273, ~/Articles/ArticleHandler.aspx, 4/24/2014 7:44:42 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement