Skip navigation
Watchlist Sponsored By :

Current DateTime: 12:05:11 13 Oct 2008
LinksList Documentid: 24355697

Current DateTime: 12:05:11 13 Oct 2008
LinksList Documentid: 24890560
  • Risk & You

      It's a risky world out there. Whether it's investment or retirement, career or home you can take steps to lower your risk profile.

  • Wall Street In Crisis

      With shock after shock to the world's financial system, the credit crunch continues to drive a major reconfiguration of the Wall Street landscape.

  • Protecting Your Portfolio

      Credit Crunch. Recession. Bear Market. There's a triple threat out there for investors. Here's a guide to managing your money.

Diebold Rejects United Tech Takeover Offer As Too Low
By Reuters | 03 Mar 2008 | 04:24 AM ET
Text Size

Diebold said Monday its board has rejected an unsolicited $2.64 million takeover offer by diversified U.S. manufacturer United Technologies.

ATM
The No. 2 maker of automated teller machines said in a statement that the $40-per-share bid undervalues the company.

"UTC's proposal is an opportunistic attempt to buy Diebold at a time when shareholders do not have sufficient data to evaluate the offer and as such, the board believes that it would be irresponsible to engage in discussions with UTC at this time," said John Lauer, Diebold's non-executive chairman, in a statement.

North Canton, Ohio-based Diebold has been under scrutiny by the U.S. Securities and Exchange Commission for its revenue recognition policies and in January said it would be restating its financial results for 2003 through 2006. It has not filed financial statements with the SEC since March 31, 2007.

Diebold [DBD  Loading...      ()   ] shares were up 59 percent to $38.28 in afternoon trading on the New York Stock Exchange. At Friday's market close, the stock had lost more than half its value since hitting a peak of $54.50 in August.

United Tech [UTX  Loading...      ()   ] shares were down 1.9 percent to $69.16.

When it disclosed the offer, United Technologies said it had studied Diebold for several years, but had been rebuffed on a prior approach.

"We should view this approach as a ploy to force (Diebold) to the negotiating table," Deutsche Bank analyst Nigel Coe wrote in a note to clients.

UBS analyst David Bleustein wrote: "Given the hostile nature of the proposed transaction, we believe other global industrials with interests in related industrial markets, including either the elevator or fire/security spaces, may give the transaction a look."

A deal would mark United Tech's entry into the ATM business, but Diebold's global footprint -- with strong positions in India, China and Russia -- is similar to United Tech's presence in its other industries, analysts said.

Goldman Sachs analyst Deane Dray wrote in a note to clients that United Tech's offer appeared reasonable, based on Diebold's revenue.

Analysts expect Diebold to record revenue of $2.93 billion for 2007 and $3.1 billion for 2008, according to Reuters Estimates.

Based on Diebold's roughly 66 million shares as of May 7, the deal would be worth $2.64 billion.

Hartford, Connecticut-based United Tech, the world's largest maker of elevators and air conditioners, said it still expected to post profit per share of $4.65 to $4.85 this year.

Analysts on average have forecast $4.86, according to Reuters Estimates.

Copyright 2008 Reuters. Click for restrictions.

HOME  |  NEWS  |  MARKETS  |  EARNINGS  |  INVESTING  |  VIDEO  |  CNBC TV  |  CNBC PLUS  |  CNBC MOBILE  |  CNBC HD+
About CNBC   |   Site Map   |   Privacy Policy   |   Terms of Service   |   Advertise   |   Help   |   Feedback   |   Video Reprints
  Data is a real-time snapshot   *Data is delayed at least 15 minutes

Global Business and Financial News, Stock Quotes, and Market Data and Analysis