On Friday, the Phoenix Business Journal was handed an exclusive PR with some fascinating M&A news. Limelight Networks has a received a bid for the company. Then over the weekend, Limelight threw some cold water on the idea but probably not enough to quench it outright just yet.
It seems a private equity company called Tuition Build has offered $645M for Limelight, which would be something like $6.55 per share and would see the company taken private. That’s a substantial premium to the current stock price.
But Limelight has quickly fired back that it believes that Tuition Build does not have the experience, credentials, financial resources, or capability to complete the proposed transaction. While the PR puts Tuition Build Inc in Menlo Park, California, that’s about all I have been able to find about the company. But whatever Limelight learned in its own research, it didn’t like. You don’t put the word ‘questionable’ in the title of your response after a mere 48 hours otherwise.
Dan Rayburn mentions that Limelight has rebuffed numerous offers over the years, which doesn’t surprise me much — though the price tags he mentions them turning down do. Having a hostile bid come out of the blue like this seems like a gambit to put the company in play, whether it wants to be or not.
I still feel that a network operator might be the right sort of inorganic fit for Limelight. I’m not sure what a private equity takeout would do for them.
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