If the stock drops below 100 - will this impact the acquisition? Curious where there is a point on the stock price where it doesn't make good business sense.
4 replies (most recent on top)
Yeah this deal is not at all like Citrix. The Citrix deal is based on them raising new debt. This deal is current cash and stock from AVGO. So the street’s opinion on this doesn’t matter like it does in the Citrix deal.
current stock price is a reflection for the likelyhood of the acquisition going through - in the eyes of the market.
if there were no risks to the acquisition as written, vmw would be at $142.50 or whatever that number was.
Read up on the Citrix Tibco merger and how Vista and the banks are struggling to raise the money via debt offerings. The VMW deal is of the same structure, except larger. Markets change. If the banks cant sell the bonds they need to finance the deal, it will not go through. And markets are facibg head winds. Inflation, interest rates, general cyclical issues, etc.
Hock has long term vision not daily stock price and also separates price from how he has calculated the intrinsic value of acquisition. Despite what you think of his approach he’s an exceptional business man.
Zero impact. Get ur head out of the sands, nothing is stopping Hock....