3Com Takes TippingPoint
3Com is offering $47 per share -- roughly $430 million based on Friday's closing price -- for the Austin, Texas-based company. That would be a 13 percent premium, 3Com executives noted. Understandably, TippingPoint's share price was up $4.89 (12%) to $46.55 late today; 3Com, meanwhile, had dropped 34 cents (8%) to $4.10.
The deal is expected to close in the third quarter of 3Com’s 2005 financial year. TippingPoint would eventually operate as a division of 3Com, with TippingPoint CEO Kip McClanahan as division president. McClanahan would report to 3Com CEO Bruce Claflin.
The deal isn't all that surprising. Merger and acquisition activity in the telecom equipment market is starting to pick up, as identified in October’s Light Reading Insider report, "M&A: Consolidation Craze." Increasingly, the major vendors are focused on deals with the long-term potential to help carriers reshape networks for delivery of packet-based, converged services.
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— James Rogers, Site Editor, Next-Gen Data Center Forum