Time is running out for ECI Telecom Ltd. to find another buyer.

The optical manufacturer has until midnight tonight to rustle up alternate bids before it is locked into the $10 per share price offered by Shaul Shani's Swarth Investments LLC.

On July 2, ECI announced that it had reached agreement to be bought out by Swarth and other funds that had appointed Ashmore Investment Management as their investment manager in a deal valued at $1.2 billion. The deal was backed by the company's board of directors, as well as a group of shareholders accounting for 44 percent of ECI shares. (See ECI Bought Out in $1.2B Deal, ECI Announces Buyout, and ECI in $1.2B Takeover Talks.)

Under the terms of the deal, ECI had 30 days to find other bidders. But the company has yet to come forward with details of other interested parties, despite reports that ECI was entertaining a possible higher bid from an international fund earlier this month.

Otherwise, the Swarth buyout appears to be moving along as planned: ECI called for an extraordinary general meeting of shareholders to be held on August 29, and the company is reportedly seeking regulatory approval for the deal. (See ECI Calls EGM.)

ECI can count on 44 percent of shares voting in favor of the deal. That includes affirmative votes coming from the 41 percent of shares owned by Koor Industries Ltd. and Clal Industries and Investments Ltd. , both of which are controlled by IDB Group . Also committed to the deal is an additional 3 percent held by Carmel Ventures, where ECI Chairman Schlomo Dvorat is a founder and general partner.

Analysts say there doesn't appear to be another buyer out there for the company. One analyst, who didn't want to be named, said ECI had been on the block for about a year before striking the Swarth deal, so it was unlikely another buyer would emerge at the eleventh hour.

Even though there aren't other buyers, it is largely believed that ECI is worth more than what it's fetching. In a research note last month, Jefferies & Company analyst George Notter wrote that $10 per share was "not exactly a 'full' valuation," and reiterated a price target of $11.00, which he wrote "more accurately reflects, albeit conservatively, the intrinsic value in the business."

Our anonymous analyst said the Swarth agreement "seems like a sweetheart deal between IDB and Swarth."

"[ECI] is probably worth $13," he says. And even taking into account that IDB may be giving Swarth a generous discount, "it's worth at least $11."

Shareholders may have more to say during the general meeting scheduled for next month. For the merger to be approved, 75 percent of shares must vote in favor of the deal.

— Ryan Lawler, Reporter, Light Reading