Shares of Foundry Networks Inc. (Nasdaq: FDRY) took a beating this afternoon when the company postponed the shareholders meeting that was supposed to seal the merger with Brocade Communications Systems Inc. (Nasdaq: BRCD).

Foundry shares sank as much as 43 percent this afternoon and were down $4.05 (24%) at $12.99 near the end of the trading day. Shares were trading above yesterday's close until Foundry's announcement hit the wires just before 2:00 p.m. Eastern time.

Shares of Brocade shot upwards, on the other hand -- up 44 cents (15.4%), to $3.29, late in the afternoon.

What happened? Foundry's press release mentions only "recent developments related to the transaction." Foundry's investor relations team could not immediately be reached; Brocade officials wouldn't comment, other than to say they still expect the deal to close this quarter.

The most recent thing to happen in the public eye was Foundry's third-quarter earnings report yesterday afternoon. (See Foundry Reports Q3.) But as one analyst told Light Reading, there aren't any obvious red flags there. Foundry's earnings per share of 19 cents beat analyst estimates by 2 cents, according to Reuters Research .

Until now, the biggest question about the $3 billion deal had been Brocade's ability to secure a $1.1 billion loan, a factor the company put to rest early this month. (See Brocade Secures Credit, Brocade to Acquire Foundry, and Brocade Takes Aim at Cisco (& Juniper).)

It's possible that the financing is still a problem for Brocade. "Their management was on the road to do a round of financing through last night, and I don't know what the results of that were," says Erik Suppiger, an analyst with Signal Hill Capital Group LLC .

It's possible, then, that Foundry is just giving Brocade a couple more days to get the financing sealed, Suppiger speculates. "It wouldn't seem like an unreasonable move."

Another possibility -- equally speculative, from another source -- is that Brocade wants to negotiate a better price.

Whatever the reason for the delay, sources aren't seeing signs that the deal is in jeopardy.

"Last week, there was every indication that things were moving forward," says one source, noting that Foundry salespeople were being told to start attending Brocade sales meetings.

Light Reading will update this story as more details arise.

— Craig Matsumoto, West Coast Editor, Light Reading