Carbonite Buyout Soap Opera Continues
If you’re into stocks and you like soap operas, the recent drama surrounding Carbonite is riveting. This week’s episode of As the Stock Turns goes like this: J.J. proposed to Carmen, but she has cold feet so her meddling Aunt Angie pressures to go through with the wedding anyway.
Let’s translate that into Carbonite’s situation. A couple of years ago, J2 Global, a digital services company, made an unsolicited offer to buy out Carbonite, the popular online backup service. (That’s J.J. proposing marriage to Carmen.) J2 already owns 9.5% of Carbonite and is its third largest shareholder, but it wants to purchase the rest of the company for $15/share in cash which comes out to around $415 million.
Two years later, Carbonite still hasn’t replied to J2’s offer, so on December 23, 2014, Engine Capital, a lesser Carbonite shareholder owning 2.5% of shares, sent a letter to Carbonite urging it to accept J2’s buyout. (Engine Capital is Aunt Angie.)
J2 Global can afford the diamond ring: as of a September regulatory filing, J2 held about $515 million in cash. What’s more, this isn’t even the first time J2 has tried to acquire Carbonite. In 2012, J2 offered $10.50/share.
J2 Global’s offer is scheduled to expire at 5 p.m. on January 26, 2015. That means Carmen only has another month to make up her mind about marrying J.J.
What will Carmen do? Will Aunt Angie continue sticking her nose in Carmen’s business? Is Carmen toying with J.J. because she has another suitor in mind? Or is she instead looking to maintain her independence? Stay tuned for the next episode of As the Stock Turns.
If you don’t use an online backup service yet, click here to read our in-depth review of Carbonite and other backup services.