Epicor Lacks 'Cruise' Control
The geniuses at Epicor Software (EPIC) pulled a Jerry Yang when they should have pulled a Jerry Maguire.
Hedge fund Elliott Associates abandoned its hostile takeover bid for Epicor last Friday, causing shares of the business software maker to sink to a five-year low of $3. The money manager, which owns 12.5% of the company, withdrew its $7.50 a share offer after Epicor's board rejected its overtures, backing management instead.
Quite simply, rather than yelling "Show me the money!" like Tom Cruise's character in the movie, Epicor's braintrust showed shareholders their ineptitude.Epicor's refusal to sell the company is just unfathomable considering the pummeling of Yahoo! (YHOO - Get Report) when it spurned Microsoft's (MSFT - Get Report) $33 bid. Last we checked, Yahoo! shares were trading below $10 and now "temporary" CEO Jerry Yang is begging Microsoft to reconsider. In a letter to the company's board, Elliott said it was "astounded and disappointed" by Epicor's recommendation that stockholders reject its offer. The fund also alleged that several other potential buyers expressed interest in purchasing Epicor only to be rebuffed by the board. Epicor's board maintains its business plan provides more value to stockholders than selling the company. That brings to mind another Tom Cruise blockbuster: Mission Impossible. Dumb-o-meter score: 65 -- Epicor did not make "all the right moves." In fact, they engaged in "risky business." (OK, we'll stop with the Tom Cruise references now).