In my earlier posting on the HP - Dell bidding war for 3Par, I wondered how much of the valuation was due to a better understanding by the bidders of the target's intangible assets. Was there some hidden value that the market didn't see in the company -- especially for the acquiring company? It could well be, given that investors may value intangibles differently than an operating company.
Now comes word that the war is over and HP has won. Dell dropped out when HP raised its price to $33 a share. This is for a company that was trading at Dell was originally willing to pay $18 a share for and was trading at $9.65 before the bid was made.
Does anyone really believe that value of 3Par's intangible assets are almost 3.5X greater that what the market estimated? Maybe the $18 bid make sense, but I can't help thinking that the last price is nothing but froth.
It will be very interesting to see how HP books the value of those intangibles once the acquisition is finalized.
Leave a comment