The $8.30 a share cash offer, below Monday’s closing price of $8.65, is far from generous, though Harbinger promised a special dividend from cash balances and the sale of non-core businesses and a continuing stake in the business.
Moreover, while Openwave had run out of ideas after CEO David Peterschmidt quit in March, when the company announced it was investigating strategic alternatives, New York-based Harbinger has a vision of its future.
Harbinger managing director Howard Kagan said it had developed a revitalization plan to drive sustainable, long-term profitable growth, particularly in software licensing revenue through the combination of Openwave and BridgePort.
He said it intended to position Openwave as a leader in the converged messaging market through the integration of its existing product portfolio with BridgePort’s complementary software.
Harbinger plans to appoint BridgePort CEO Mike Mulica, a former Openwave SVP, as CEO of the merged company. The company quoted Mulica as forecasting enthusiastic support throughout the industry for the converged services that this merger would bring. He said he was thrilled at the prospect of revitalizing Openwave and returning it to the thought and product leadership for which it was once known.
While Openwave managed to turn a $62.1m loss into a profit of $5.7m in the year to June 30, on revenue 7.4% higher at $412m, it has been downhill all the way ever since with revenue in freefall. In its most recent quarter to March 31, it turned a $9.6m profit into a loss of $32.5m on revenue 37.1% lower at $71m.
