The art of the hostile deal; I.B.M. used tricks old and new to win Lotus quickly
Article Abstract:
IBM's lightning fast hostile takeover of Lotus Development Corp was a textbook illustration of how careful planning, aggressive action and innovative techniques can be used to seal a deal quickly. IBM will purchase Lotus for $3.5 billion in a deal that was concluded in less than a week. IBM was prepared to fight Lotus on legal grounds for four to six months, but the challenges never materialized. Also, the federal government declined to make objections within the specified time period, signaling that IBM had its consent to make the deal. Most importantly, no rivals decided to make competing bids for the software company. IBM decided to purchase Lotus because it wanted its popular Notes network messaging software as a hedge against Microsoft in the network software market. IBM decided to advance in a hostile manner because the company wanted to prevent Lotus from bidding up the price by negotiating with rivals, or selling its products off piecemeal.
Publication Name: The New York Times
Subject: Business, general
ISSN: 0362-4331
Year: 1995
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Chiefs of Lotus and I.B.M. discuss bid; software maker still tries to avoid takeover
Article Abstract:
IBM Chmn Louis V. Gerstner Jr. and Lotus Chmn and CEO Jim P. Manzi recently met to discuss IBM's hostile takeover bid for the software maker. The exploratory meeting in NY is perhaps the first indication Lotus is at least willing to listen IBM, which is attempting to acquire Lotus through a $60-per-share tender offer. Officials at both companies declined to comment on the hostile takeover attempt. Lotus' Manzi was reportedly 'devastated' by the prospect of losing control of his company and called Gerstner to request the meeting. The request came after Manzi received several inquiries from other possible acquirers or strategic partners, according to one official at Lotus. Some of the interested parties are reportedly Japanese companies. Before listening to the details of these offers, Manzi met with Gerstner to get a clearer picture of IBM's intentions.
Publication Name: The New York Times
Subject: Business, general
ISSN: 0362-4331
Year: 1995
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In shift, the hostile takeover is recast as a benevolent act
Article Abstract:
IBM's proposed $3.3 billion hostile takeover of Lotus is being recast as a necessary maneuver in an industry that has become increasingly competitive. Officials at IBM say that the days when large companies utilized the Old Boy network and valued corporate citizenship have been replaced by a competitive attitude that favors intense competition over anything else. Many companies see that other companies are using aggressive competition and hostile takeovers as part of their corporate strategy and are adopting these methods. Analysts who work for law firms that guide takeovers agree that hostile acquisitions have become the conventional wisdom in thinking about corporate growth. Companies are now seeing hostile takeovers not as destructive business practice but as a way to reduce costs and increase return on investment for shareholders.
Publication Name: The New York Times
Subject: Business, general
ISSN: 0362-4331
Year: 1995
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