As activist investors go, Carl Icahn holds some real power. His latest claim to fame is a serious acquisition bid on middleware designer BEA Systems
The prospective fiancee is database giant Oracle
BEA's board of directors wants a better deal, and Oracle says that it's willing to talk turkey, even though this bid looks more than fair. The current share price is higher than Oracle's bid, suggesting that Mr. Market thinks a fatter pitch is on the way.
A bidding war for BEA and its hefty middleware market share is possible, but the usual suspects are playing coy right now. SAP AG
After all, IBM is betting a lot on its WebSphere platform, and it would hate to see two of its strongest rivals combine forces. Some analysts think that Big Blue should merge with SAP just to counter the Oracle-BEA alliance, but that would be highly illogical. SAP is nearly 10 times BEA's size, and integrating two of the world's largest software empires would be a drawn-out nightmare.
No, look for one of three more sensible moves here: IBM and Oracle slug it out with competing hostile bids; Oracle just tacks on a higher premium and goes home with the prize; or Icahn gets what he really wants, an auction-style bidding contest.
And of course, the whole thing just might fall through, too. Buying BEA stock today is a gamble that the company's price tag will grow before an eventual sale. A sensible investor might take the gains here and go look for a safer bet.