June 16, 2005

Why Siebel is probably not a viable takeover target

Author: Melanie Hollands

There's been press lately about Siebel Systems being a potential acquisition target. (We last wrote about Siebel on April 8.) Siebel has a market capitalization (i.e., the value of its shares) of around $4.64 billion as of the market close on Friday, May
Melanie Hollands

T27. And a potential buyer would have to pay some kind of premium. So that's a pretty large sum for a potential acquirer to fork out.

On May 28, the San Jose Mercury News reported tensions between the company and its large investors regarding an employee benefit plan. Siebel increased employee benefits, and some have interpreted this as a tactical move to make Siebel more expensive (and therefore less attractive) to a potential acquirer, rather than simply a move to benefit the employees.

Then on May 30, eWeek reported that Siebel would continue with its technology development roadmap, despite some recent management changes. The company still plans to release Siebel 8.0 in 2006, an upgrade from the current (outdated) Siebel 7.0 series products. In April, Michael Lawrie, Siebel's former CEO, was booted from the firm. In May, Eileen McPartland, the company's former SVP of global services, resigned.

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