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Wednesday, August 10, 2005

Register.com's (RCOM) Bitch Fight

Very interesting developments over at Register.com. First, buy-out company Barrington, headed by James Mitaroanda, lobbed in a bid at $7.10 a share for the remaining 85% that it doesn't own. Then the ravenous tech buy-out firm Vector Capital countered with a $7.81 a share bid that was accepted by Register's board. Vector recently acquired BroadVision and tried to wrest Pinnacle Systems from Avid.
Then today Mark Cuban (of BlogMaverick fame) announces that he will actively fight the Vector offer as it the offer is too low. This gets interesting because he hold 3.3 million shares or 13% of the company. Of course one could question Mark's valuation skills based upon his recent investment and then devestment in Mamma.com, but he will always have credibility based upon his decision to fully cash out of the Internet bubble after he sold Broadcast.com to Yahoo! for $5.7 billion.
This is a classic "bird in the hand" problem for Register's board. Do they go with Vector's offer as it stands or do they hold out and demand more for their money. It's interesting that there aren't many public Internet companies involved in this scuffle -- that is always an indication of how they perceive Register's strategic market value. In this case it's not very much.

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