Computer Sciences opens door to sale while rejecting CA's $9.18 billion bid

Article Abstract:

Computer Sciences' official rejection of a hostile $9.18 billion tender offer from Computer Associates International (CA) as 'inadequate' formally paves the way for a potential sale or merger with another company. This marks the first confirmation that Computer Sciences is considering higher offers. The computer-services company announced that it will 'explore and consider all alternatives available to the company which may prove greater value to stockholders' than the $108-a-share offer from CA in Feb 1998. By comparison, Computer Sciences had insisted on maintaining its independence prior to this statement. Possible alternatives to the CA move include a sale, merger or any other combination with a third party, according to Computer Sciences. The company also could offer more shares to the public or assume debt, which would raise CA's acquisition cost.

Data Processing Services, Data processing and preparation, Computer Service Bureaus

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Computer Associates opens hostile bid of $9.18 billion for Computer Sciences

Article Abstract:

Computer Associates International (CA) has made a hostile takeover bid of $9.18 billion for Computer Sciences. Industry observers are labeling CA's move risky due to the nature of Computer Sciences' business. A computer-services business needs loyal employees to succeed, as it does not rely on products to bring in revenue. CA's stock fell $2.3125 to $46.0625 on Feb 17, 1998 as investors worried that the company was in for a long, protracted battle and its inexperience in managing a consulting business. CA's stock has slipped 21% since Feb 11, when the company first offered to buy Computer Sciences. Computer Sciences stock has also suffered with share prices falling 81.25 cents on Feb 17, down to $106.5625.

Prepackaged software, Computer Software, Software Publishers, Computer software industry, Software industry, Software

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Similar abstracts:

• Abstracts: Computer Sciences Corp. defenses against takeover to be probed. Computer services company vows fight on hostile offer; some analysts urge suitor to end its bid

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