AT&T; Raises Bid to NCR’s Price--$110 Per Share : Technology: The computer company responds by saying its chairman appears ready to recommend acceptance of the offer.
American Telephone & Telegraph said late Sunday that it has made a final, $110-per-share stock-swap offer for NCR Corp., and the computer company appeared poised to accept it.
Reuters quoted an NCR spokesman late Sunday as saying that Chairman Charles Exley will recommend the offer to the NCR board if AT&T; gives assurances that shareholders will get $110 in value at the time the offer closes.
The Dayton, Ohio-based computer maker has said for some time that $110 per share was the minimum price it would accept.
The assurances that the NCR spokesman referred to involved guarantees to shareholders in the event that the value of AT&T;’s shares--which closed at $37.375 Friday on the New York Stock Exchange--drops before the merger is completed.
“This is an all-but-done deal,” said Ulrich Weil, a high-tech analyst in Washington, D.C. “NCR may be trying to extract a few more concessions, which is typical in negotiations. But this deal is definitely in the final rounds.”
AT&T; made it clear that it wants the months of negotiating, haggling, posturing and stalling to end.
“It is time to bring these negotiations to a close . . . . This is the best offer NCR shareholders will see,” said AT&T; Chairman Robert E. Allen. “There will be nothing better. I believe NCR shareholders will be deeply disappointed if this opportunity is not seized.”
AT&T; has been trying since early December to acquire NCR, the nation’s fifth-largest computer maker, in order to boost its sagging efforts to enter the computer business and blend its telecommunications network with the growing field of computerized data communications.
NCR’s initially staunch opposition to AT&T;’s wooing gradually melted over the months to the point where only money separated the two sides. Until AT&T; made its latest proposal to NCR on Friday afternoon, its best offer was $100 per share. NCR had been demanding a minimum of $110 per share.
Allen said Sunday that AT&T; sweetened its offer one more time because its own stock had risen to $37.375 per share, a price that made the stock-swap for NCR roughly equivalent to its earlier $100 all-cash offer.
“The recent increase in our stock price provided us with an opportunity to offer NCR its asking price and still be fair to AT&T; shareholders,” Allen said.
AT&T;’s offer is contingent on the stock-swap being handled as a “pooling of interests,” an accounting procedure that essentially would allow the two companies, on paper, to combine their operations, assets and liabilities.
If such an arrangement cannot be worked out, AT&T; said its all-stock offer would be converted into a deal in which 40% of NCR’s shares would be acquired for $110 in cash and the remainder of its shares swapped at a ratio of 2.943 shares of AT&T; to 1 share of NCR.
“I’d be surprised if NCR doesn’t accept. I just don’t see how they can say no,” said Craig Ellis, a telecommunications analyst at C. J. Lawrence in New York. “It seems as though NCR got what it wanted.”
