ArcSight shares shoot up after a report of a possible buyout
By APFriday, August 27, 2010
ArcSight shares shoot up after buyout report
NEW YORK — Shares of ArcSight Inc. got a boost Friday after a report in the Wall Street Journal said the provider of network security software and services could be sold as soon as next week.
THE SPARK: According to the report, which cited people familiar with the matter that the newspaper did not name, the company has been quietly shopping itself around to a few large technology companies, who could pay as much as $1.5 billion for the company.
ArcSight declined to comment on the report.
THE BIG PICTURE: The possible sale comes a week after chip maker Intel Corp. said it will buy another security company, McAfee Inc., for $7.68 billion.
THE ANALYSIS: JMP Securities analyst Patrick Walravens kept a “market perform” rating on ArcSight and said he thinks “it would take another bidding war to drive a much higher valuation and consequently (he does) not recommend chasing the stock at this time.”
SHARE ACTION: Shares of Cupertino, Calif.-based ArcSight rose $2.94, or 8 percent, to $39.57 in afternoon trading. Earlier, the stock hit a 52-week high of $39.74.
