EMC Extends Data Domain Bid as FTC Decision Looms


EMC (NYSE: EMC) has extended its takeover offer for Data Domain (NASDAQ: DDUP) ahead of a critical decision from the FTC (see Data Domain's Just Not That Into EMC).

EMC late Friday said it was extending its $30-a-share cash offer for the data deduplication specialist until midnight on July 10, the first of what could be several extensions before the takeover battle with rival NetApp (NASDAQ: NTAP) is resolved.

Just 0.28 percent of Data Domain investors have tendered their shares in response to EMC's offer, but the data storage giant owns about 4 percent overall of Data Domain common stock. NetApp claims "voting agreements" in favor of its offer with about 20 percent of DDUP shareholders, but a merger deal with EMC would nullify those agreements.

EMC CEO Joe Tucci reiterated the company's claim that its cash offer is "superior to NetApp's stock and cash offer and, very importantly, delivers to Data Domain stockholders the price certainty and price protection its management team and board stated as important priorities during their negotiations with NetApp."

Data Domain has expressed a preference for NetApp's offer despite shareholder lawsuits claiming that the company failed to get the most value for shareholders. Neither NetApp nor EMC have raised their offers beyond $30 a share, leaving the matter — for now — in the hands of shareholders, although some observers have said they expect EMC to raise its bid as a shareholder vote on the offers nears.

NetApp has claimed that an EMC-Data Domain combination could face antitrust obstacles. That view has been largely dismissed by analysts, but the Federal Trade Commission is nearing a deadline for deciding whether to conduct a lengthy antitrust review or let the deal go through unchallenged. A decision from the FTC could come any day.

Tucci touched on the matter in his statement, saying, "We continue to anticipate a routine review by the FTC resulting in a timely regulatory approval. We look forward to the execution of the definitive agreement and closing of the transaction with EMC."

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