Oops. It seems the market did not at all like Internet security company Symantec's
That seems to be the consensus among market watchers, at least. CBS MarketWatch
But valid as that view is, it does a better job of explaining what has happened to Symantec's stock price over the first half of this week than it does of explaining yesterday's 8% drop in the value of Symantec's shares. Since Tuesday morning, when rumors of the buyout began circulating, Symantec's share price has plunged from nearly $33 to yesterday's close of just over $25 -- a 24% drop in all.
It seems to this Fool that the real reason for yesterday's final (Symantec investors hope) plunge in the company's stock price was not the confirmation that Symantec would buy Veritas. Rather, it was the news that Microsoft
Keep that in mind if Veritas' shareholders refuse to approve this merger. Because even if the deal falls through based on the decline in Symantec's share price, those shares won't return to their pre-buyout offer level. Rather, they'll remain weighted down with Microsoft angst. (And yeah, verily, Veritas' shareholders could decide to turn Symantec down now. Because at Symantec's current share price, its offer of 1.1242 Symantec shares per Veritas share is worth just $28.25 per Veritas share. That's less than a 1% premium to Veritas' current share price, and probably not worth the bother.)
Can't get enough of merger news? Read Tim Beyers' marathon coverage of the Oracle-PeopleSoft merger in:
- A $13 Billion Christmas Present?
- OracleSoft At Last
- You Say Sell, I Say Potato
- When No Really Doesn't Mean No
- Oracle's Final Offer
Fool contributor Rich Smith has no position in any company mentioned in this article.